HONG KONG (Reuters Breakingviews) - Unrest is the recurring cost of Hong Kong’s elite procrastination. Home prices have risen and tycoons have grown wealthier, while officials hoard fiscal reserves. Today’s protests focus on resistance to Beijing’s influence, but local officials’ stubborn indifference to inequality since the last round of unrest in 2014 has stoked the flames.
HONG KONG (Reuters Breakingviews) - Blockades and walkouts roiled Hong Kong this week. Unlike similar unrest in 2014, investors are getting anxious. Trade tensions and economic weakness in China have helped to erase the Hang Seng Index’s gains this year, but local indicators like real estate and retail are cooling too. Beijing may not mind that protests squeeze business, if the rising cost of resistance divides the movement. That means there could be more disruption to price in.
HONG KONG (Reuters Breakingviews) - Corporate activism tastes different in China. Soft drink Pocari Sweat is caught in a firestorm after it pulled television ads in apparent support of Hong Kong protests. Such statements can pay off for brands that have political influence, or stand to win more friends than enemies. With Beijing involved, neither is usually the case.
HONG KONG (Reuters Breakingviews) - Hong Kong’s tycoons know scale can come at the cost of coherence. Protests in the city initially focused on the need to stop extraditions to the mainland; but the movement has broadened, and recent rallies have turned violent. That raises risks for investors and businesses, already suffering collateral damage. What happens next is harder to predict too.
HONG KONG (Reuters Breakingviews) - China’s auto pessimism could be over-revved. A grim start to the year saw sales slump by more than 10 percent compared with the first half of 2018. Chaos reigned amidst new rules, while Beijing remained reluctant to offer stimulus. But policy pressure is uneven, and the worst could be past.
HONG KONG (Reuters Breakingviews) - Hong Kong’s embattled leader is beating a belated retreat. Carrie Lam said on Tuesday that a controversial bill allowing extraditions to the mainland was dead, calling the government’s work to amend the law a total failure. The humiliating climbdown aims to defuse street protests; but she’ll need more to regain the confidence of corporate bosses, investors and citizens.
HONG KONG (Reuters Breakingviews) - Hong Kong protesters triumphantly took over the city’s legislature, but there is little to celebrate. Amid another march against a controversial extradition plan, a furious faction broke into the empty building on Monday night and trashed it, deepening a crisis for Chief Executive Carrie Lam. The violence will weaken some of the movement’s support, spook big business and could give Beijing a pretext to dig in.
HONG KONG (Reuters Breakingviews) - Evergrande’s electric dreams have taken an alarming turn. The property giant has already put over $4 billion into green vehicle brands and dealers. Next, it plans to plough 280 billion yuan ($41 billion) into research facilities and factories, according to statements shared on its website last week. For the same money boss Hui Ka Yan could buy Tesla, valued at $39 billion. But he’s no Elon Musk, and this could derail a debt clean-up.
HONG KONG (Reuters Breakingviews) - Carrie Lam’s government could squander Hong Kong’s privileged position in the eyes of foreign governments. A bill that would allow extradition to the mainland prompted hundreds of thousands to protest on Sunday. If the chief executive ignores the message, Washington, Brussels and others may reconsider their relationship with the territory. That would hurt both Hong Kong and China.
HONG KONG (Reuters Breakingviews) - The territory's government, under pressure from Beijing, is trying to ram through a rule change that would allow suspects to be transferred to mainland courts. Foreign executives have cause to be worried. Plus: Steve Bannon wants to ban Chinese IPOs from New York.