HONG KONG (Reuters Breakingviews) - Beijing has yielded to Hong Kong’s unique economic status. Carrie Lam, chief executive of the special administrative region, on Saturday indefinitely suspended a bill that would have allowed extradition to the mainland, responding to mass rallies and violent street protests that rocked the city. It’s a defeat for her, and leaves the central government embarrassed. But for the Chinese Communist Party, preserving Hong Kong’s financial role still trumps the desire for more political control.
HONG KONG (Reuters Breakingviews) - A Chinese listings purge would be a nightmare on Wall Street. Marco Rubio, a Republican U.S. senator, wants to force mainland companies that have gone public in New York to submit to audit oversight - or leave. It’s a radical solution to a real problem. But torching shares valued around $1.8 trillion is a harsh price to pay for transparency.
HONG KONG (Reuters Breakingviews) - For the second time in less than five years, tear gas is wafting through the streets of Hong Kong. Violence flared in the financial centre on Wednesday as police used gas and rubber bullets to disperse protesters opposing an extradition bill. Pro-democracy demonstrations in 2014 fizzled out. This movement will prove harder to defuse.
LONDON/HONG KONG (Reuters Breakingviews) - Squint hard, and it’s possible to interpret the latest headlines involving Renault and Fiat Chrysler Automobiles as progress towards reviving the carmakers’ 33 billion euro merger. Step back, however, and negotiations involving the French group’s state shareholder and Japanese ally Nissan Motor expose the dysfunctional governance which would hobble a broader partnership.
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.
HONG KONG (Reuters Breakingviews) - After crushing student protests in 1989, the Chinese Communist Party promised citizens prosperity in exchange for compliance. Wages have risen 40 times since then, but inequality has soared too. Controls have tightened. Now President Xi Jinping is again asking youth to bear the brunt of the economic burden, from bad debts to the trade war.
HONG KONG (Reuters Breakingviews) - Hedge funds see honey in Japan’s value traps. Companies from the Land of the Rising Sun dominated pitches at Hong Kong’s Sohn Conference on Thursday. They pointed to signs of unjustified panic in the country’s equities slump, creating opportunities to buy low. But even optimists highlighted the persistent cash hoarding and slack governance that have long scared investors away.
HONG KONG (Reuters Breakingviews) - China is ducking a bankruptcy test. Baoshang Bank, linked to missing billionaire Xiao Jianhua, has been brought under state control. Despite threats, Beijing remains wary of allowing even disgraced local lenders to fail.
HONG KONG (Reuters Breakingviews) - A U.S. blacklist could wind up thrusting Huawei Technologies into Beijing’s embrace. Important suppliers including Arm, Panasonic and Intel have been cutting off the Chinese telecom champion following the Trump administration’s ban last week. Extreme endgame scenarios can no longer be ruled out.
HONG KONG (Reuters Breakingviews) - Google's hidden costs are giving Beijing sticker shock. Washington, busily upping the trade war ante, may ultimately ban Chinese telecom champion Huawei from using Google's proprietary technology, including its app store. The search engine is blocked in China, but local handset makers selling abroad have come to rely on the group’s technology anyway: the open-source Android system powers their phones. An embargo would threaten much of a $175 billion export market.