The People’s Daily, the Chinese government’s media mouthpiece, went off on the richest man in Hong Kong for investing his money outside the mainland in a social media post published on Sunday.
Li Ka-Shing controls CK Hutchison Holdings, a conglomerate of mostly energy and infrastructure assets. He also owns some mobile phone networks and Cheung Kong Property Holdings, a property development company.
Bloomberg estimates that he is worth $US32.6 billion.
He has recently been restructuring his company, in part, to prepare for his 51 year-old son to take over the company. In doing so, Li has purchased assets and moved money to the EU.
The last thing the government wants is for Li’s money to go elsewhere just when the Chinese economy has been experiencing a slow down.
The People’s Daily editorial went through three distinct positions on Li. The first was that his moves were immoral, the second argued that his moves were stupid, and the last one argued that China didn’t need him anyway.
Kind of like a break up.
On the moral argument, The People’s Daily questioned whether or not it was “moral” for Li, who has made money on the mainland, to leave it at a time when China’s stock markets are convulsing and economic indicators are flashing red.
“In the eyes of ordinary people we shared comfort and prosperity together in the good times but when the hard times come he abandons us — this has really left some people speechless,” it said, according to the FT.
The People’s Daily also took that argument a step further, saying that even if Li’s money moves were not a moral issue, they were illogical. The Chinese economy, it seemed certain, would come back to life soon enough.
“Li Ka-shing has earned money in the mainland and even if it is morally legitimate to stop him from moving his capital out now because of special privileges he received in the past, it is not logical and not in accordance with the spirit of rule by law.”
Finally, there was the whole ‘who needs him?’ thing.
“China accounts for more than 12% of the global economy … Can the withdrawal of a single businessman affect the fundamentals?”
It continued: “”We won’t need to worry about investors not coming after Li’s departure as long as China deepens its reforms … and keeps the market lively.”
So far China’s reform plans have not really materialised. The Economist said in a recent article that China’s attempts to reform its state-owned enterprises have “failed to impress” and this summer markets have been more than lively — they have been treacherous.
Since its first precipitous drop on June 12th, the Shanghai Composite, the mainland’s biggest stock market, has fallen 37%. In August, the government devalued its currency, the yuan.
Who needs him, indeed.
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