2019-08-26 Bloomberg Businessweek

(Frankie) #1
◼ ECONOMICS Bloomberg Businessweek August 26, 2019

27

HongKong’srichestmanbrokehissilenceon
Aug.16.LiKa-shing,thenonagenarianfounderof
CKHutchisonHoldingsLtd.,thecity’smostimport-
antconglomerate,publishedstatementsinChinese-
andEnglish-languagenewspapersurginga haltto
theunrestwrackingtheterritory.
Liwasthemostprominentofa groupoflocal
propertytycoonsthrowingtheirweightbehind
HongKong ChiefExecutiveCarrieLam’scalls
forcalm.Amongthosealsomakingstatements
werePeterWoo,retiredchairmanofWheelock&
Co.,oneofthecity’slargestlandlords,andHenry
Cheng,headofa property-to-jewelryempirethat’s
buildinga HK$20billion($2.6billion)shopping-
and-entertainmentcomplexatthecity’sairport.
Meanwhile,AdamKwok,executivedirectorofSun
HungKaiPropertiesLtd.,thecity’slargestdevel-
oper,joineda pro-governmentrallyonAug.17.
HongKong’sbillionaireshavegoodreasontodis-
couragethedemonstrators.Thetumultis hitting

● Policiestocurbthepowerofthebigconglomerates
mayhelpappeaseprotesters

Sydney Vancouver Hong Kong

12 16 20

economythatremainedoverwhelminglydependent
onrevenuefrombankingandproperty,anditsport
nowhastocompetewithmainlandrivals.
WhileLamhasspokenoftheeconomicdis-
location,shehasyettocomeupwitha planfor
dealingwithit,andshehasn’tshownmuchempa-
thy.“Theyhavenostakeinthesocietywhichso
manypeoplehavehelpedtobuild,”shesaidat
anAug.9 pressconference,“andthat’swhythey
resorttoallthisviolenceandobstructionscaus-
inghugedamagetotheeconomyandtothedaily
lifeofthepeople.”
OnAug.20,Lamofferedanolivebranchto

many of their businesses as tourists cancel their trips
and stores along protest routes shut their doors. The
economy will contract 0.3% this year, and prop-
erty prices could decline up to 10% in the next 9-12
months, according to a Morgan Stanley forecast.
There’s also the possibility that, once the unrest sub-
sides, the government will take aim at policies that
have helped property developers accumulate huge
fortunes in a city where homeownership is out of
reach for millions of ordinary people.
Besides demanding universal suffrage and other
political reforms, many of the protesters are frus-
trated with Lam’s inability to make the city more
affordable. Addressing those concerns means chal-
lenging the property barons, according to Regina Ip,
a pro-Beijing lawmaker who calls the current crisis
“a turning point for Hong Kong.”
The outsize role of a few family-owned conglom-
erates is a legacy of colonial rule. Under the British,
land couldn’t be bought outright but had to be

... Could Put Billionaires


In a Bind


protesters,pledgingtoimmediatelyengagein
dialogue and investigate complaints against the
police. Protesters rejected her offer because it fell
short of their demands, raising questions about
whether the two sides can reach a compromise
even as they seek to reduce tensions. Analysts
say the next six weeks before the 70th anniver-
sary celebration of the founding of the People’s
Republic of China will be particularly sensitive.
�KariLindberg,ShawnaKwan,andEndaCurran

*CITIES WITH AT LEAST 1 MILLION PEOPLE IN AUSTRALIA, CANADA, IRELAND, NEW ZEALAND, SINGAPORE, U.K., AND THE U.S., AS WELL AS HONG KONG; DATA: DEMOGRAPHIA. HONG KONG GDP DATA: BLOOMBERG ECONOMICS


THE BOTTOM LINE While politics sparked the protests, sky-high
living costs and diminishing career opportunities have fired up
young Hong Kongers.
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