Many ports in a storm

Hong Kong Chief Executive John Lee joins the hand-wringing over CK Hutchison’s sale of ports…

There have been “extensive discussions in society about the issue,” which reflects “society’s concerns over the matter,” Lee said.

“The Hong Kong SAR government urges foreign governments to provide a fair and just environment for enterprises, including enterprises from Hong Kong,” he said.

“We oppose the abusive use of coercion, of bullying tactics in international economic and trade relations,” Lee said, adding that “any transaction must comply with legal and regulatory requirements.”

The story also makes AP, Reuters and the NY Times…

John Lee, the leader of Hong Kong, added his voice on Tuesday to escalating warnings from China, saying the transaction deserved “serious attention.”

…Shares in CK Hutchison, which is controlled by one of Hong Kong’s richest people, Li Ka-shing, fell nearly 3 percent on Tuesday after Mr. Lee’s comments…

…On Tuesday, Hong Kong’s Mr. Lee said that “any transaction must comply with the legal and regulatory requirements.” Speaking at a weekly press briefing, he said that the government would “handle it in accordance with the law and regulations.”

He did not elaborate, but legal experts said that, historically, mergers or acquisitions undertaken by Hong Kong companies and foreign ones have not had to seek the kind of regulatory approval Mr. Lee was potentially referring to.

It is not clear what, if anything, the Hong Kong authorities could do to stop the deal. By contrast, Chinese companies often must secure permission from the Ministry of Commerce, the State Administration of Foreign Exchange and other regulators to sell assets or move money out of mainland China.

But the warnings have raised concerns among some in the financial community about the politicization of business in Hong Kong, a former British colony that was returned to Beijing in 1997 under the promise that it would operate with “a high degree of autonomy.” This pledge changed in 2020 when Beijing imposed a national security law on the city to quash pro-democracy protests.

While Mr. Lee’s government has repeatedly emphasized that Hong Kong remains an open place to do business and a global financial hub with laws separate from the rest of China, some critics have pointed out that its government is under pressure from Beijing.

Global Times wolf-warrior/scribe Hu Xijin also apparently weighs in on the subject, somewhere – not sure where. As does ex-CE CY Leung…

Leung Chun-ying, Vice Chairman of the CPPCC National Committee, published a post on social media on Monday, asking without naming anyone: “Do businessmen have a motherland?” Wen Wei Po reported on Tuesday.

Leung stated that some Hong Kong businessmen mistakenly believe in the notion that “business knows no borders” and assume that everything is purely business. However, businessmen without a motherland will only face bullying. He emphasized that businessmen should also prioritize their country.

He pointed out that American businessmen can only act in alignment with US interests and cannot do anything that goes against them. He concluded that this inherent relationship between American businessmen and their country applies equally to other nations, including the UK, Canada, and Singapore—”and China is no exception.”

Witness Donald Trump’s effusive welcome for the deal.

The WSJ offers a possible reason for the anguish over the affair…

Chinese leader Xi Jinping is angry about a Hong Kong company’s plan to sell Panama Canal ports to a U.S.-led group, in part because the company didn’t seek Beijing’s approval in advance, people familiar with the matter said.

The Xi leadership had originally planned to use the Panama port issue as a bargaining chip in negotiations with the Trump administration, according to people close to Beijing’s decision-making, only to see the rug pulled out from under it.

…Xi’s unhappiness suggests he, too, sees the canal that way and doesn’t like to be painted as the loser. His government republished a commentary last week describing the deal as a betrayal of the Chinese people.

…In Beijing, several Chinese authorities including the State Administration for Market Regulation and the Ministry of Commerce have been told to study the deal with the aim of reviewing what Beijing can do to hinder it, according to a person familiar with the matter. Bloomberg earlier reported the Beijing authorities’ review.

Despite Beijing’s unhappiness, it doesn’t have a simple way to halt the deal. The assets to be sold are all outside mainland China and Hong Kong, and the parties to the transaction have expressed confidence that it can be completed.

The deal puts Xi in a tricky position. On one hand, Beijing has had to make clear its anger over the Hong Kong company’s move, which came without advance notice, to protect Xi’s strongman image, the people close to decision-making said. On the other, they said, Beijing is aware that any significant effort to torpedo the deal risks escalating tensions with the Trump administration.

And further reduce confidence among Mainland, Hong Kong and overseas investors.

The round-up of wanted activists’ relatives continues with Tony Chung’s stepfather…

Chung’s stepfather was “taken away” on Tuesday morning by national security police, Ming Pao reported, citing sources.

The stepfather was taken in to “assist in the investigation” of Chung’s suspected offences of inciting secession and colluding with external forces to endanger national security, Sing Tao Daily reported, also citing sources.