Greater Yackity Blah Bay Area Vision Hub Thing unveiled

For the most excruciatingly indigestible jargon-laden waffle since we hit peak One Belt One Road Vision-Concept around three years ago, here’s your personal copy of the Outline Development Plan for the Blah Blah Bay Area. As the South China Morning Post front-page cheerlead-story breathlessly enthuses, Hong Kong is mentioned 102 times compared with a pitiful 41 for crummy old Guangzhou so there yah boo sucks. (In its eagerness to shoe-shine, the paper ruins what was supposed to be an oh-so-subtle deliberate message-hidden-in-number-of-namechecks.)

Xi Jinping decreed that the grand vision come into being, and after working overtime, many minions have finally delivered their frantically concocted components to put together in a ‘blueprint’.

A quick check shows that the word ‘green’ – a rough proxy for BS – appears 31 times, five of them in the quintessential horse-crap phrase ‘green finance/bonds’. The Communist-demonic curse ‘cooperation’ is used an incredible 162 times.

At the risk of encapsulating an over-simplified nutshell: Relevant central ministries will leverage ecologically sustainable fintech to nurture Lusophone cross-boundary innovation and talents through in-depth cooperation [told you] between the Dongguan Binhaiwan New District and youth development to enhance the radial effect of Lingnan culture.

It’s not all plucking dreamy vision-concepts from thin air. Some junior minions have been forced to rummage around for specific stuff to meet box-checking requirements. Thus they grant the most humble jurisdictions special important individual roles, so even Jiangmen, Zhongshan, Hengqin of Zhuhai and others don’t feel left out. And they found actual visible comprehensible items to put some roughage into the otherwise substance-less verbiage. These are, of course, depressingly awful – right down to ‘development of international cruise terminals’. And something about yachts. They had to find something.

This is not a plan for Hong Kong’s integration with the motherland. This barrage of wrist-slashing, soul-crushing lameness is the Chinese Communist Party’s idea of sugar-coating, designed as a distraction.

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HK government ‘wrong, stupid, bizarre, clueless’ – everyone

The Hong Kong government’s proposal to ban trading but not personal possession of e-cigarettes prompts an above-average amount of exasperated eye-rolling and mockery as wrong and stupid and bizarre and clueless.

It is a classic example of our bureaucrats’ default approach to contentious issues that are not subject to the wishes of overriding forces like Beijing or property tycoons. With no party-state or landed interests to serve – and no representative political structure to express majority opinion – they have to fall back on values or principles to find a clear answer to a problem. But they have none. Their sole focus is on avoiding criticism, and small but loud interest groups know it.

In fairness, we should not blame the civil servants who form the administration. As Margaret Thatcher is supposed to have said, consensus is an absence of leadership. In Hong Kong, there is no-one in charge because the Chinese Communist Party won’t let anyone be in charge. So the non-solution of problems is systematic.

The government is unable to work out a way of managing traffic flows through the cross-harbour tunnels. It can’t unravel the rent-hikes/shop-closures mess following privatization of public-housing shopping malls. It eventually granted workers the right to manage the part of their compulsory savings coming from their own salaries, but not the part contributed by employers. Providing Uber services is forbidden, but using them is OK. Even with a trillion dollars in shut-up money to play with, the government just can’t fix things.

In the e-cigarettes case, officials seem to be pandering to a well-intentioned but hyper-zealous anti-smoking lobby, while at the same time bowing to the reality that government cannot control citizens as if they were toddlers. The obvious policy, given e-cigarettes’ likely potential role in harm-reduction, is to regulate them as with normal cigarettes as a lesser evil. Instead, this ‘solution’ might actually increase ordinary tobacco use. (We’ll be charitable and assume that if this proposal creates more business for the tobacco industry it’s unintentional.)

Where will the next such moronic inanity come? Perhaps it will be the issue of overseas-trained doctors. Bureaucrats will devise a formula that increases the supply of medical staff but simultaneously doesn’t. Sounds impossible – but they will find a way.

 

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Friday links

First Canada, now Sweden finds that its ambassador to China seems to be working for Beijing – the weird experience of Angela Gui, who is made of sterner stuff. More here.

It takes determination to alienate dovish and affable nations like Canada and Sweden. Google ‘backlash china’ and you see just how much Xi Jinping has managed to damage his country’s reputation in maybe just 18 to 24 months. The Maldives, Huawei, Senator Sam Dastyari, Hambantota port, CEFC, Kenyan standard-gauge railway, Country Garden/Forest City, Gwadar, Venezuela, Anne-Marie Brady, Taiwan-bludgeoning, Canadians-as-hostages, Huang ‘Australia giant baby’ Xiangmo, Confucius Institutes – not to mention domestically sourced PR nightmares like Uighur prison camps, the social-credit panopticon, etc.

It’s as if when Xi came to power, someone wiped all of Beijing’s institutional knowledge of the outside world, and they’re blundering around learning from scratch. The shock! of realizing that corrupt overseas governments might give way to leaders who recoil at exploitative Belt and Road deals. The disbelief that, rather than sign up to become vassal states, places like Poland and the Czech Republic might see through ‘the purely congratulatory tone of 16+1 lavish events’.

Huawei seems to have been the tipping point. You want shock? Respectable Chinese global tech giant business model based on bribery. And it’s inseparable from the state. Here’s a good piece on the implications for Australia (and everywhere). Clunky responses to this fall from grace reflect Beijing’s own ineptness: faux legal opinions, trying to bully Australian businesses, a not-quite-clever ad campaign in NZ.

Xi’s relaunch of the China brand as obnoxious highlights how misreading can go both ways. An Atlantic piece ditches old US assumptions and describes how Washington faces a China that is powerful but also undergoing likely economic stagnation and internal decay. On which point, here’s Michael Pettis on China’s GDP – or how Beijing cooks the books (also a layman-friendly reminder of the inadequacies of economic growth measurements generally).

I declare the weekend open with some fizz: Coca-Cola on its 40th anniversary in China.

 

 

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Mega-snore meeting to hit town Thursday

Hong Kong’s first major bore-fest of the year takes place next week. The ‘symposium’ on the Greater Bay Area will include Chief Executive Carrie Lam, leaders from all your favourite fun Pearl River Delta cities, and senior planning types from the national development and reform commission.

Although Beijing announced the Greater Bay Area Themed Integration Hub-Zone Vision several years ago, no-one really has a clue what it is. The timing suggests that merging uppity Hong Kong into its hinterland – symbolically, psychologically or concretely – was the main driver (thus allusions to San Francisco and Tokyo that look like clunky attempts at hipness).

Beyond that, it seems like a classic case of Chinese Communist Party doing-things-backwards, like ‘Belt and Road’: the vanity-fueled top man announces a grand-sounding but nebulous strategy; shoe-shiners bow down and worship the idea; underlings then scrabble around to find policies and projects that fit the vision; and finally everyone watches to see what the outcomes are – and praises or buries them accordingly.

After much talk of a Bay Area blueprint over the last year, the central government is finally about to release an ‘outline development plan’. But word is that it will simply be more vague slogan-waffle, so the assembled officials at next Thursday’s gathering will just be ‘exploring opportunities’ – raving rapturously at the wondrousness of the Greater Bay Area Win-Win Partnership Powerhouse Concept to a public that is still none the wiser. The NPC/CPPCC ‘two meetings’ in March are also supposed to focus on the ‘Big Bay Region’. (A ho-hum theory: Beijing doesn’t want to alarm Trump.)

One apparent theme, last repeated in China Daily, is something about ‘avoiding vicious competition’ among the different jurisdictions in the region by allocating specific roles to individual cities. This approach is a big turn-on for the central-planning types up north, but would be resisted by the dozen or so local governments in the area, and of course it challenges Hong Kong’s traditional free-market principles.

It might be nothing. But given Xi Jinping’s autarkic leanings and the growing potential for weaker relations between China and the West – deglobalization, etc – Beijing might seriously think this is the region to experiment with a new tech-finance Chinese-characteristics dirigiste economic model. For what it’s worth, he’s very proud of his dad’s role in Deng Xiaoping’s gamble on transforming the paddy fields between Guangzhou and Hong Kong into the dazzling (allegedly) space-age metropolis that is Shenzhen.

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A tempting idea

Hong Kong is considering an extradition agreement with the Mainland. It is one of those slightly bewildering ‘One Country Two Systems’ anomalies that, 20 years after the return to the motherland, the city still has no legal mechanism to send criminals over the border, while transfers to and from Western and other countries are no problem.

Opposition lawmakers are concerned that an agreement would result in political dissidents being handed over to China’s public-security gestapo. However, under the current system, Chinese agents abduct you, drug you and put you on a speedboat at the dead of night, so formal extradition via a court hearing might be an improvement (assuming the Communist Party kidnap squads entered the spirit of the new legislation and did things by the book, ho hum).

Another worry is that decent, rule-of-law, civilized jurisdictions might become nervous about sending a suspect to Hong Kong lest he is passed on to the Mainland.

So we are understandably nervous about this idea. Until the South China Morning Post report mentions a juicy possibility that might make you change your mind. The extradition proposal also includes Macau. Macau, of course, wants property tycoon Joseph Lau (having sentenced him to prison in absentia for corruption). Mmmm… It suddenly sounds rather enticing*.

(Just as we must use ‘boundary’ instead of ‘border’, to avoid subliminal impure thoughts of nationhood, we are supposed to say ‘rendition’ instead of ‘extradition’. Or at least we were. Or has ‘rendition’ become too uncool?)

*Small print might in fact preclude transfer in his particular case, before you get too excited.

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Pig Year is open

We ease ourselves into the muddy slime of the Year of the Earth Pig with a quick flick through today’s headlines and some vaguely worthwhile links.

A Dubai-based port operator is suing a Chinese state-owned rival for barging into its exclusive territory in sunny Djibouti – in a Hong Kong court. It will be Hong Kong’s first ‘Belt and Road’ case, and an opportunity to banish doubts about the independence of its judicial system if one party is an arm of the sovereign Communist party-state that by definition is above the law. (I’ve no idea of the details. It is not impossible that all commercial parties involved are scum and the Dubai company happens to be clearly in the wrong. But ideally, this would involve PRC-UAE strategic wrangling in the Horn of Africa and therefore involve national security, thus presenting our courts with a real test.)

On domestic affairs, Hong Kong is to phase out analogue TV to free up UHF bands, etc. I didn’t realize it was still going, or that there are still people out there who actually watch broadcast TV (currently bingeing on blacks in Japan). In a classic example of our bureaucrats’ perverse sense of spending priorities and erratic approach to welfarism, the government will subsidize digital TV sets for the poor. When I was a kid we had to upgrade from a black-and-white VHF set with clunk-clunk dial for changing channels by our own bootstraps and never complained or expected socialist handouts of household electronic equipment.

A short but exquisitely curated selection of reading material suitable (I recommend Pocket for saving until later).

Why is heritage conservation such an ordeal in Hong Kong? Because preventing someone from getting rich is a sin comparable to killing one’s parents. (Which you knew already, but an interesting reminder.)

Your definition of ‘heritage’ may differ. The US foundation of that name has just given Hong Kong its regular accolade for economic freedom. The tediousness of this annual ritual drives SCMP columnist Alex Lo into such a deranged state that he writes a column that isn’t total crap. Such strangeness can only be an omen that the Heritage Foundation crown is soon to pass to Singapore.

That would fit into the Big Picture of which Hong Kong is a small feature, gradually being dragged down and absorbed into an increasingly insular, revanchist, nationalistic and oppressive China transforming itself from the world’s electronics maker to global threat. One-time SCMP editor Robert Keatley bashes out a quick one on the decline of Hong Kong, including the possible eventual loss of the city’s favoured trade status under US law. This sounds far-fetched today – but that brings us back to the Djibouti ports case.

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Last links of the Dog

With Monday likely to be write-off before the Lunar New Year zombie-time, I declare what looks set to be an unprecedented six-day weekend (possibly, at a stretch, a nine-day one) open – with a modest handful of diversions.

The Taiwan Sentinel on how China’s leaders’ paranoia is starting to look downright Soviet, as Mainland censors ban TV palace dramas and guys’ earrings.

Nobel economist Martin Feldstein on the US-China trade dispute: it’s not about soybeans and steel (have we told Trump this?), but tech and cheating. (I was once sent, in my capacity as Company Gwailo, to pick Prof Feldstein up at his hotel and escort him in one of the gleaming corporate Mercedes to the HK Monetary Authority – all because the Big Boss was mesmerized by the Nobel thing and was desperate to get in the great man’s face, by proxy at least. Slightly awkward, out-of-my-depth, conversation.

And for the differently attention-spanned, a nice series of student-made videos over at HK Free Press: ‘Hong Kong Humans’.

That’s it ‘til Pig Year.

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Panda self-mutilates

It’s hard to imagine just how much trust (albeit passive and implicit rather than deep and heartfelt) has evaporated in the last few weeks. Following the release of the Huawei charges, here’s something on the implications for foreign businesses, notably in China – and for ‘How screwed is’ Huawei itself.

Unless you’ve seriously not been paying attention, you will know that Vancouver-based former Hong Kong reporter Joanna Chiu got a scoop confirming that Canada’s ambassador to China John MacCallum seemed to be siding with Beijing over the Huawei affair – promptly getting the guy fired. Had the diplomat succumbed to the United Front’s ‘good friend’ grooming treatment and become something of a Beijing asset? Here’s regretful/hilarious hand-wringing about journalistic ethics from China’s state media to help you decide.

The Star called around other ex-diplomat types, who openly said that ‘Beijing views foreign diplomats as outgoing communication channels’. The thing is that, until so recently it was largely and quietly getting away with it (ditto with businessmen and academics).

Now, one commentator describes the Huawei saga as Canada’s wake-up call. He also writes that ‘In detaining Kovrig … the CCP has shot itself in the foot’, adding that prospects for a Canada-China free-trade agreement and an extradition treaty are now zero.

China has for years generally cultivated good relations with Canada. Canadians pride themselves on being ‘nice’ and a tolerant country, but presumably do not like it if their good-naturedness is mistaken for gullibility or servility. And now Beijing has blown it, rejecting any chance of claiming moral high ground, and indulging in its bizarre and massively uncool tantrum of hostage-taking and near-racist insults.

If you can piss off Canadians like this, is there any hope for you with the rest of the world? Expand the impact of this remarkably sudden outbreak of obnoxiousness across the rest of the English-speaking democracies and Europe, and Beijing has managed to transform itself – and its corporate sector – into a ‘global menace’. And still doesn’t seem to even be aware of it.

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Carrie Lam is a lunatic, Standard reveals

Anthony Wu, former Hospitals Authority head and fully paid-up member of the Hong Kong Tycoon-Bureaucrat Mutual Lovey-Dovey Shoe-shine Pig Trough Appreciation Society, joins the calls to admit overseas-qualified doctors to relieve pressure on the healthcare system. The Standard’s editorial says not doing it is insane.

Chief Executive Carrie Lam dismisses the idea on the grounds that there is ‘no consensus’ – not in the community as a whole, but merely among the city’s few thousand medics.

What is exasperating about this (and this is perhaps why even some establishment voices are at odds with top officials) is that Carrie would see a real boost in her popularity if she declared that she would put the public interest first and went ahead and hired overseas-trained doctors – and to hell with the HK Medical Association. After the old-age welfare-cut fiasco, this is a woman who could seriously use better poll ratings.

All you have to do is: shut up, stop automatically screeching at critics that they are wrong, listen to what insightful (as in know-how-to-buy-toilet paper) people outside the government say (try a few focus groups), and then… Do What They Tell You. Blam – instant improved governance, with a happy population heaping praise upon you.

Sadly, Beijing’s requirement of ‘executive-led government’ means in practice ‘deliberately non-responsive anti-people policymaking’. It’s not just that you can’t have democracy, but you have to actively prove that you don’t have it through provocative and destructive decisions. It seems an angry populace is necessary to reassure the CCP that its puppet administration is in full control and not degenerating into some scary regime-toppling Western-style representativeness-thing.

More advice to our dim-witted administration – on fiscal matters – here.

 

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The doctor will see you next week

HK Free Press reports a dazzling outburst of common sense from a public-sector employee. The public hospital doctor complains that the government is sending front-line medical staff on Mainland ‘national studies’ courses while hospitals are struggling to keep up with a seasonal flu outbreak. If true, it is an outrageous scandal/utterly unsurprising.

(These courses, typically a week long at a Mainland institute, are now routine for many Hong Kong middle-senior civil servants and other public-sector workers. By all accounts, they are condescending or preachy propaganda classes explaining the ‘correct’ versions of China’s development, the PRC constitution, foreign relations and other subjects. Mainland organizers tell participants not to divulge details.)

The doctor also calls for the government to take two steps to improve public hospital patient services. One is to directly hire doctors with (good-quality) overseas qualifications, rather than allow the local Medical Association to restrict the supply of skills through additional local professional exams. The other is to stop admitting so many Mainland immigrants, who are adding to the strain on the health system.

This newsworthy item confirms what many suspect – that there are, indeed, public servants with functioning brains. Obviously, this one is grossly unfit to progress to policymaking levels of government.

I wonder what the national affairs course will have to say about today’s big news – Uh-oh, we’re in trouble…

Something the lecturers probably don’t cover is the wondrous state of China’s housing market. Here is the Fascinating Statistic du Jour: in 1Q 2018, only 31% of households buying a residential property were buying their first unit; 44% were buying their second; and 25% were getting their third. (China’s housing market is magic: since private home ownership resumed in the 1980s, buyers have only seen property values rise, and this will continue for ever and ever.)

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