Keywords: Rural development, youth’s nationalism, cybersecurity, smog pollution, Xiao Jianhua’s disappearance, Chief Executive Election in Hong Kong.

CHINA – SOCIETY

 No. 1 Central Document on rural reform in 2017

The Central No.1 Document has been focused on rural reform in 14 years in a row. In the latest document for 2017, it called for “strengthening the reform and innovation” in the countryside. For a graphic illustration of the main points in the document of 13,000 words, please find it here by Xinhua (in Chinese).

• //This year’s document put more emphasis on « strengthening reform and innovation, » compared to the one of 2014, Zhu Lizhi, a research fellow with the Chinese Academy of Agricultural Sciences told Xinhua. China’s agricultural modernization is expected to be accelerated with the help of the new policy document, Zhu added. Highlighting the role of agriculture, the document said a strong agricultural sector is the prerequisite of a strong China. […] Instead of mainly pursuing high output and relying on resources consumption, China should put equal emphasis on quantity, quality and benefits, and attach importance to competitiveness, technological innovation and sustainable growth, it said. The document urged making the transition as quickly as possible. […] The second major task is to boost farmers’ income. China will increase investment in the agriculture sector and the countryside, boost the effectiveness of agricultural subsidy policies, improve the pricing mechanism for farm produce and enhance supporting services, said the document. […] The third task is to accelerate the building of new socialist countryside. The government will boost rural infrastructure building, raise public service levels in rural areas, improve rural environment, and encourage more social capital investment in rural development. […] The fourth major task is to deepen rural reforms. More efforts will be made to establish a new-style agricultural management system, accelerate reforms of rural collective property rights system, steadily push forward pilot reforms of rural land system, carry out rural financial system reforms, and deepen water conservancy and forestry reforms. […] Fifthly, The document calls for improving agricultural and rural legal system to strengthen the rule of law in dealing with issues such as protection of rural property rights, regulation of rural market and rural reforms. The document for the first time noted the importance of rule of law and it is the strengthened rule of law that will ensure rural reforms be carried out smoothly, said Zheng Fengtian, an agriculture professor at Renmin University of China.// Source: Xinhua, 01 February 2017.

• //During the reform process, it is imperative that national grain security be guaranteed, according to the document. Output dropped slightly in 2016, ending a 12-year rising streak, but still the second highest year on record. China has entered a stage of rapidly rising customer expectations. Consumers want their food to be of high quality and they seek greater choice. As Tang said, the basic objective of agricultural reform is to provide safe, edible food. […] Little can be achieved without financial support and professional expertise. Fiscal support for agriculture and rural areas should show moderate growth and loans will be made easier to obtain, according to the document. Public private partnerships, subsidies and special rural development funds are just some of the ways the government will encourage investment, Tang said. Migrant workers will be encouraged to return home and start their own businesses. Careers in agriculture will be made more attractive through professional training for farmers and managers. There will be incentives for college graduates, entrepreneurs and returned students from overseas to bringing their technological and managerial skills to rural areas.// Source: Xinhua, 06 February 2017.

According to Southern Weekly, three points have been highlighted in the document. First was to empower the peasants by training them to become professional in agriculture as well as encouraging capital from the society to facilitate the process. Second was to reform the legal system related to collective economy in rural area, including defining more clearly the property rights. Third was to encourage migrant workers, graduates, entrepreneurs, etc. to go to rural areas for investment and innovation.

• //南方周末记者梳理后发现，这份万字文件的核心亮点有三：一是给农民赋能；二是激活农村各类集体组织；三是号召各界精英和各路资本下乡。在给农民赋能上，“一号文件”提出要开发农村人力资源，培养新农民。具体来说，鼓励社会资本进入培训市场，让农民变成职业化和专业户农民。[…] 总体推进思路是，加快农村各类资源资产权属认定，推动部门确权信息与银行业金融机构联网共享。在激活村集体上，“一号文件”提出要抓紧研究制定农村集体经济组织相关法律，赋予农村集体经济组织法人资格。对农村集体经济实体，进行股份制改革，把农村的资源变资产，资金变股金，农民变股东。“一号文件”还提出要把农村土地集体所有权、农户承包权和土地经营权梳理清楚，进行“确权”，实现“三权分置”，扩大相关确权登记颁证试点范围。鼓励大家到农村去创业创新，是今年“一号文件”的第三大亮点。一号文件”呼吁进城农民工返乡创业，鼓励高校毕业生、企业主、农业科技人员、留学归国人员等各类人才回乡下乡创业创新。“一号文件”提出，要整合落实支持农村创业创新的市场准入、财政税收、金融服务、用地用电、创业培训、社会保障等方面优惠政策。 “一号文件”还鼓励各路资本下乡。提出要研究制定引导和规范工商资本投资农业农村的具体意见。// Source: Southern Weekly, 06 February 2017.

Deputy Director of the Central Rural Work Leading Group (中共中央农村工作领导小组副组长) Tang Renjian (唐仁健) pointed out that the rural reform aimed at making agriculture more efficient and innovative, peasants having more income, and village more environmentally sustainable. There are three bottom lines: to ensure no decrease in productivity of agricultural produces, no return of the trend for the increase in peasants’ income, and no instability in rural area.

• //“当前农业农村发展的内外环境发生了大的变化，出现许多新矛盾新问题。”中央农村工作领导小组副组长、中央农办主任、中央财办副主任唐仁健说，“主要是农产品需求升级了，有效供给跟不上；资源环境承载能力到了极限了，绿色生产跟不上；国外低价农产品进来了，国内竞争力跟不上；农民增收传统动力减弱了，新的动力跟不上。” 他认为，矛盾的主要方面在供给侧，突出的是结构性、体制性矛盾。深入推进农业供给侧结构性改革，就是要从供给侧入手、在体制机制创新上发力，从根子上解决这些矛盾问题。“农业供给侧结构性改革成不成功，要看供给体系是否优化、效率是否提高，更要看农民是否增收、是否得实惠。主攻方向是提高农业供给质量。”唐仁健表示，要用改革的办法来推动农业农村发展由过度依赖资源消耗、主要满足量的需求，向追求绿色生态可持续、更加注重满足质的需求转变，实现农业增效、农民增收、农村增绿。他特别强调，农业供给侧结构性改革是一个长期的过程，不可能一蹴而就，还可能会经历大的阵痛，付出一些代价，但在方向性问题上不能出大的偏差，不能犯颠覆性错误，必须守住三条底线，确保粮食生产能力不降低、农民增收势头不逆转、农村稳定不出问题。仁健在解析文件内容时说，农业供给侧结构性改革包括结构调整和改革两大板块。其中，农业供给侧结构要推进“三大调整”——调优产品结构，突出“优”字。[…] 调好生产方式，突出“绿”字。推行绿色生产方式，修复治理生态环境，既还历史旧账，也为子孙后代留生存和发展空间。[…] 调顺产业体系，突出“新”字。着力发展农村新产业新业态，促进三产深度融合，实现农业的全环节升级、全链条升值。文件提出大力发展乡村休闲旅游产业、推进农村电商发展、加快发展现代食品产业、培育宜居宜业特色村镇等。// Source: The Beijing News, 06 February 2017.

There is an ongoing trend for impoverished villages to start up e-commerce for local economic development with the support of the State Council. Daji Township, Shandong province, represents one of the successful “Taobao Villages” which has caught successfully the e-commerce boom with the business opportunity offered by the Internet and the online sale platform Taobao:

• //Today, the township and its surrounding area are China’s domestic capital for one rather specific category of products: acting and dance costumes. Half of the township’s 45,000 residents produce or sell costumes—ranging from movie-villain attire to cute versions of snakes, alligators, and monkeys—that are sold on Alibaba-owned Taobao, the nation’s largest e-commerce platform. Daiji sold 1.8 billion yuan ($26.2 million) worth of costumes in 2016, and local officials guess the entire county sold nearly three times that, or about 70% of the costume market on Taobao. […] Much has been written about China’s rural e-commerce boom, with these so-called “Taobao villages” now a national policy priority in rebuilding rural China and eliminating poverty. Vice premier Zhang Gaoli, a former Shandong party secretary and now one of the most powerful officials in China, visited Daiji in late 2015 and praised (link in Chinese) the township’s contribution to decreasing poverty. In November 2016, the State Council Office on Poverty Alleviation, along with 16 other ministries, released guidelines calling for a massive expansion of e-commerce in rural areas as part of the fight against poverty. By 2020, the guidelines state (link in Chinese), impoverished rural counties should quadruple their e-commerce sales. […] China’s president Xi Jinping has vowed to eliminate absolute poverty in China by 2020, staking some of his reputation on leaving nobody behind in creating a “moderately prosperous society.” There are still more than 56 million people in China living in poverty (paywall), according to China’s national income standard of 2,300 yuan per year in 2010 constant prices (now approximately 3,000 yuan, or $436). The government projects (link in Chinese) the cutoff will rise to about 4,000 yuan ($582 at current exchange rates) when the poverty elimination deadline arrives in 2020. […] As part of the state’s targeted poverty alleviation campaign, the township government sponsored e-commerce and clothing-production training classes, provided low-cost loans, and encouraged successful entrepreneurs to prioritize hiring locals who remained below the poverty threshold. In less than four years, 6,300 people in Daiji and its surrounding county have moved above the official poverty line due to e-commerce sales, according to data (link in Chinese) provided by Alibaba’s research arm. […] Yet despite local optimism and high-level government support, many of the areas mired in the country’s most intractable poverty may have difficulty capitalizing on the e-commerce boom. Daiji does have an advantage over other impoverished areas, observers say: Its flat plains eased the creation of roads and infrastructure. […] Most importantly, the country’s poorest areas, devoid of working-age population, face a shortage of laborers with skills adapted for the new economy. “When everyone left, it was a big loss for those areas,” says Yu Jiantuo. “It’s not an issue of the number of people leaving but of the type of people who were leaving.” The last time China experienced a rural industrial boom, collectively owned township and village enterprises (TVEs) leveraged plentiful labor, local government support, and a very low bar for consumer demand to rake in huge profits and create millions of rural jobs during the 1980s and early 1990s. TVEs were necessary, argued legendary rural sociologist Fei Xiaotong, in part because it would help reverse the “brain drain” from rural to urban areas.// Source: Quartz, Undated.

CHINA – POLITICS

1. Survey found that nationalism among the Chinese youth may not be as high as perceived

A new paper published in the journal International Security by Prof. Alastair Iain at Harvard University suggested that nationalism among the youth may not have increased as many reports indicated. For the full text of the article, please find it here.

• //Since 1998, Johnston has worked with researchers at Peking University, a flagship university in Beijing, to produce a survey querying the city’s residents about their views on a variety of subjects, including foreign policy. The unique dataset that has resulted — called the Beijing Area Survey — has allowed Johnston and his collaborators to track the evolution of Beijingers’ views over time, broken down along a number of different categories, including age. Since 2002, the survey has also asked questions designed to tease out respondents’ nationalism, including the degree to which they agreed or disagreed with the following standard measures of nationalist sentiment: “Even if I could choose any other country in the world, I would prefer to be a citizen of China than any other country”; “In general, China is a better country than most others”; and “Everyone should support their government even when it is wrong.” The paper’s headline result suggests that nationalism among Beijing’s residents has not increased over time. On the contrary, the proportion of survey respondents strongly agreeing with the first and third statements decreased sharply from 2002 to 2015, while the number of those who agreed “somewhat” rose. Those strongly agreeing with the second statement, about China being “a better country,” did increase slightly — perhaps an understandable finding given that personal incomes and infrastructure in Beijing both improved significantly over the survey period. The results not only show a drop in sentiment resembling nationalism; they strongly suggest that Chinese youth, at least those in China’s capital, are less nationalistic than their elders, belying notions of growing numbers of internet-addled youngsters ready to take the government to task for any perceived failure to defend the national honor. […] The survey has also allowed researchers to monitor whether youth are becoming more nationalistic over time. Their results suggest the answer is no, at least for young people in Beijing — a surprising finding for a capital city whose reputation for political orthodoxy considerably outstrips that of more freewheeling, far-flung regions like the southern megacity of Guangzhou. […] Readers familiar with China are sure to note that the feelings of people in relatively well-educated, well-off Beijing may not reflect those elsewhere in such a vast and diverse country. Johnston’s paper grants this potential limitation, but points out that a nationwide survey performed by another academic in 2008 using very similar methodology obtained results almost identical to what Johnston and his collaborators found in Beijing. The policy implications of these findings are potentially significant. The research suggests that China’s turn toward a harsher foreign policy under Xi has not been a response to rising domestic nationalism — Johnston’s paper notes that other possible causes of the shift, like the level of nationalist sentiment within China’s political elite, deserve more systematic study.// Source: Foreign Policy, 07 February 2017.

2. Government’s intention to establish “Security Inspection Council” for Cybersecurity

The Cyberspace Administration of China (CAC) promulgated on 4 February 2017 the draft of the “Measures for Security Reviews of Network Products and Services (Draft for comments” (网络产品和服务安全审查办法（征求意见稿）) for public comments. In the draft it said the CAC would join hands with other relevant authorities to establish the “Security Inspection Council” to evaluate policies related to cybersecurity inspection, to centralize work of cybersecurity inspection and to coordinate related problems. In addition to assessing the risks of national security or public interests, the cybersecurity inspection also includes an assessment of risks of the commercial activities involved in the key sectors such as energy, telecommunication, and finance.

• //2月4日，国家互联网信息办公室官网公布的《网络产品和服务安全审查办法（征求意见稿）》显示，我国将成立网络安全审查委员会，负责审议网络安全审查的重要政策，统一组织网络安全审查工作。去年11月7日，第十二届全国人大常委会第二十四次会议表决通过《网络安全法》。该法明确，关键信息基础设施的运营者采购网络产品和服务，可能影响国家安全的，应当通过国家网信部门会同国务院有关部门组织的国家安全审查。[…] 依据《中华人民共和国国家安全法》《中华人民共和国网络安全法》制定本办法。关系国家安全与公共利益的信息系统使用的重要网络产品和服务，应当经过网络安全审查，并提出国家互联网信息办公室会同有关部门成立网络安全审查委员会，负责审议网络安全审查的重要政策，统一组织网络安全审查工作，协调网络安全审查相关重要问题。[…] 根据意见稿，网络安全审查包括五方面内容。一是产品和服务被非法控制、干扰和中断运行的风险；二是产品及关键部件研发、交付、技术支持过程中的风险；三是产品和服务提供者利用提供产品和服务的便利条件非法收集、存储、处理、利用用户相关信息的风险；四是产品和服务提供者利用用户对产品和服务的依赖，实施不正当竞争或损害用户利益的风险；五是其他可能危害国家安全和公共利益的风险。// Source: Xinhua, 07 February 2017.

Spokesperson of CAC further explained that not all Internet products or services are required for inspection, it depends on whether they pose a threat to national security and public interests when they are in use. The inspection will be conducted when the relevant authorities deem fit. Key sectors such as energy, finance and telecommunication are asked to implement the inspection.

• //国家网信办相关负责人表示，中国借鉴国外做法，建立网络安全审查制度。 […] 国家网信办相关负责人介绍，并非所有网络产品和服务都需要审查，是有条件的。而且，重点审查的是网络产品和服务的安全性、可控性。判定是否影响国家安全和公共利益，主要看产品和服务使用后，是否会危害国家政权和主权安全，是否会危害广大人民群众利益，是否会影响国家经济可持续发展及国家其他重大利益。[…] 国家网信办相关负责人介绍，网络安全审查办公室根据国家有关部门要求、全国性行业协会建议、市场反映和企业申请启动网络安全审查。同时，金融、电信、能源等重点行业主管部门，根据国家网络安全审查工作要求，组织开展本行业、本领域网络产品和服务安全审查工作。// Source: Xinhua, 07 February 2017.

Shen Yi from Fudan University in Shanghai explained the use of the Measure:

• //The Cyberspace Administration of China, which doubles as the Office of the Central Leading Group for Cyberspace Affairs that directly reports to President Xi Jinping, in an internet posting on Saturday sought public opinion on its draft internet product and service security inspection law, a follow-up to the sweeping Cybersecurity Law that was passed last November and will take effect in June. […] The draft spells out who exactly will be responsible for putting different elements of the Cybersecurity Law into practice and how, said Shen Yi, deputy director of the Cyberspace Governance Research Center at Fudan University in Shanghai. “Though such inspections alone are not enough to ensure that the hardware and software on supply chains will be safe, they are imperative to establishing and enhancing the nation’s cyber governance and sovereignty,” Shen said. The new measures are mainly designed to find and eliminate loopholes in products used by public infrastructure operators, according to the draft. Products and services will be scrutinized to prevent malicious manipulation, interference, or interruption of services, as well as piracy and theft of key components, it said. Together with a third party committee, the Cyberspace Administration will lead a Security Inspection Council, and will assess the controllability and security of products ranging from payment systems to hydropower monitoring software and commercial satellites. […] Shen said the new rules are designed to review suppliers and their products currently in the supply chain in crucial industries to find potential security risks. “This law will be an important instrument that gives China discretionary power over key sectors, and we should expect it will be implemented under national treatment principles,” he said. Foreign firms have complained that the law’s new requirements often force them to reveal important proprietary information and work with local partners, many of them state-owned entities with government ties. Others remain skeptical over the potency of the new laws, including concerns over unwanted consequences.// Source: Caixin Global, 06 February 2017.

In late January this year, the authorities announced a 14-month “clean-up” campaign on unauthorized Internet connections. It created a stir among VPN service users about whether their use of such service will be recorded by the Chinese authorities and later penalized, but analysts said it would be hard for implementation.

• //The Ministry of Industry and Information Technology on Sunday announced the launch of a 14-month national internet “clean-up campaign” on unauthorized internet connections. The move is expected to make the use of domestic virtual private network (VPN) services much more difficult for internet users in China. This comes as the latest of many central government efforts to reinforce China’s infamous “Great Firewall.” While they have become less reliable in recent years, VPNs are used by tech savvy-netizens and multinational companies (and even occasionally by Great Firewall architect Fang Binxing himself) to access websites blocked in China. […] Coverage from Caixin also notes mounting political sensitivity, and reports that according to a 2015 survey, 29% of internet users in China reported using VPN services. On Twitter, org notes that the new regulations target domestic VPN services and not domestic users, highlighting that foreign VPN providers have long been in government crosshairs. Last year, as VPN reliability was faltering in China, GreatFire launched Circumvention Central, a realtime VPN information database that monitors the speed and stability of leading services.// Source: China Digital Times, 23 January 2017.

CHINA – ENVIRONMENT

Proposal to tackle the smog problem by the Ministry of Environmental Protection

• //The Ministry of Environmental Protection (MEP) has proposed the measures in the document seen by Reuters. If implemented, they would be some of the most radical steps so far to tackle air quality in the country’s most polluted cities. The move comes after China’s northeast has battled some of the worst pollution in years as emissions from heavy industry, coal burning in winter and increased transport have left major cities including Beijing blanketed in thick smog. The document outlines plans to cut steel and fertilizer capacity by at least half and aluminium capacity by at least 30 percent in 28 cities across five regions from around late November to late February. […] A source with direct knowledge of the proposal said the environmental watchdog has distributed the draft to relevant local governments and companies seeking reaction. […] If introduced, the steps would likely further support rallies in aluminum, steel and coal prices, which have been buoyed by China’s efforts to shut excess capacity and clean up polluting sectors. Highlighting the difficulties enforcing that policy, Greenpeace said on Monday that China’s operational steel capacity actually rose in 2016 after a high-profile closure program concentrated on already idled plants. Still, prolonged cuts in capacity will reignite worries about demand for raw materials like iron ore and coking coal. […] The plans go further than an earlier proposal by Beijing’s regional environmental watchdog to ban coal trucks and storage in Tianjin, which it estimated would cost the port 670 million yuan ($97 million) a year in business. The five regions affected are some of the most populated and most smog-plagued: Beijing, the port city of Tianjin and the neighboring province of Hebei, as well as Shandong, Shanxi and Henan.// Source: Reuters, 13 February 2017.

Lawyer Yu Wensheng (余文生) filed a lawsuit against governments of three localities for their failure to tackle the smog problem:

• //The 50-year-old lawyer [Yu Wensheng] recently launched an unprecedented suit against the authorities in three regions in China, claiming they have failed in their responsibilities. For a government with the motto “Serve the People”, Yu feels the officials are serving other interests by allowing nearly half a billion people to choke on toxic smog. […] Yu and four other lawyers have filed cases against the governments of the capital Beijing, the neighbouring port city of Tianjin, and Hebei province, home to some of the country’s most polluted cities. “If the authorities don’t accept the case or use some other method to dismiss it, it can only show the government has a bad attitude in the face of pressure from the citizens,” Yu says. “That would clearly show they don’t serve the citizens at all.” Several in the group have been pressured by local branches of the justice ministry to withdraw the cases and another lawyer has already dropped out after he was visited by police in his hometown. But Yu is undeterred, having previously spent stints in detention, where he says he was tortured. […] In the wake of the lawyers announcing their lawsuit, China’s powerful censorship authorities issued a blanket ban on any discussion of the case – a rare edict for an environmental issue. In recent years the government has allowed some space for citizens to vent their anger over the country’s chronically toxic air. […] Even government media frequently publishes articles lamenting pollution. In the midst of a week-long bout of bad air in the beginning of January, the state-run China Daily published an editorial lambasting the government for not doing enough to tackle the problem. […] The lawyers have since refiled their cases and are waiting for a response. But even if the court agrees to hear the cases, the chance of a landmark victory is almost nonexistent. “This lawsuit on this topic at this moment in history is going to be an uphill battle,” says Rachel Stern, author of Environmental Litigation in China: A Study in Political Ambivalence. “I would be surprised if this lawsuit is successful, and if I were betting, I don’t even think it will get accepted by the court.”// Source: The Guardian, 13 February 2017.

 HONG KONG – POLITICS

 1. Billionaire Xiao Jianhua disappeared from his residence in Hong Kong

 a) Mysterious disappearance of Xiao Jianhua at Four Seasons Hotel

It is reported that Xiao Jianhua, a billionaire who controls multiple listed companies including the Tomorrow Group (明天控股), suddenly disappeared from the Four Seasons Hotel he stayed on 27 January 2017, the eve of the Chinese New Year. Rumors appear on the media about Xiao’s whereabouts, which is still unknown to the public. As reported by the China Digital Times, the relevant news was banned in Mainland China.

• //Mr Xiao was accosted in his Hong Kong waterfront apartment at around 1am on Friday, the eve of Chinese new year, by “five or six plain-clothed Chinese public security agents”, who then took him and two of his bodyguards to the mainland, said one person familiar with the investigation. The Four Seasons has provided Hong Kong police with CCTV footage of Mr Xiao, who is normally followed everywhere by a group of female bodyguards, being led away by the Chinese security agents, the person said. It is unclear what happened inside the room where Mr Xiao was living but there was no scuffle in the hallway or elevator and he appeared to go with them willingly once they all left his room, the person added. The person added that Mr Xiao called his family later and informed them he had been taken by mainland Chinese public security agents but that he was fine. He asked them to withdraw a request they had made to the Hong Kong police for assistance. […] It is unclear why he was taken. In 2014, he denied widespread media reports that he had fled to Hong Kong to avoid being caught in the president’s corruption crackdown. A statement posted on the WeChat account of the Tomorrow Group, published on Tuesday and purportedly from Mr Xiao, said he was overseas for medical treatment and would return “soon”. In the statement, which was subsequently deleted by censors, he denied he had been “abducted to the mainland”. He said he was a Canadian citizen and Hong Kong permanent resident who was protected by the Canadian consulate and Hong Kong law. He added that he “had never harmed the interests of the country” or “supported any opposition organisation”.// Source: Financial Times, 01 February 2017.

Full text of Xiao’s statement on the WeChat account of the Tomorrow Group in which he states: 1) he is now under medical treatment aboard, and will meet the media soon after the treatment; 2) he believes the Chinese Government is a civilized one which acts according to the law, and pledges the public not to mistake that he is abdicated to Mainland China; 3) He is a patriotic Chinese returned from overseas, loyal to the Party as well as the country as always, and never participates in any activity that undermines state interests or damages government image, let alone supporting any opposition force or organization; and 4) he is a Canadian citizen with permanent residency status in Hong Kong, so he is entitled to the diplomatic protection from the Canadian Consulate as well as the law of Hong Kong SAR, and he also holds diplomatic passports, so he urges everyone concerned to put their mind at ease.

• //一、本人感謝各界關心，目前正在國外治療，待療程結束後，近期將很快與媒體見面。二、本人認為中國政府是文明法治的政府，大家不要誤解！本人不存在被綁架回內地的情況。三、本人是愛國華僑，一向愛黨愛國，從未參與任何有損國家利益和政府形象的事情，更未支持任何反對勢力和組織。四、本人為加拿大公民，也是香港永久居民，受加拿大領事保護，也受香港法律保護，本人還持有外交護照享有外交保護權。所以請各界放心！// Source: MingPao Daily, 31 January 2017.

A brief background of Xiao Jianhua:

• //Xiao ranked 32nd along with his wife on Hurun’s China Rich List 2016, with US$5.97 billion in wealth. The 46-year-old is the founder of Tomorrow Group – a sprawling mainland holding company with business in many areas, including financial institutions, IT and energy. […] [X]iao had a humble beginning. He grew up as part of a poor rural family in Shandong. He was admitted at 14 to Peking University and was the head of the student union when the democracy movement broke out in 1989. However, he did not join the student protests that led to the Tiananmen crackdown. Xiao was reported to have made his initial fortune in 1999 in computer-related business in Inner Mongolia, where his wife Zhou Hongwen was raised.// Source: SCMP, 02 February 2017.

At the beginning, some media draws parallel Xiao’s case to another case related to the Causeway Bay Bookstore where one of the owners Lee Bo suddenly disappeared in Hong Kong and returned to China “by his own way” without record of passing the border (For details please see the previous CEFC press highlights on 08 January 2016 and 30 June 2016). The Hong Kong SAR Government confirmed that Xiao has returned to Mainland China through one of the border-crossing checkpoints.

• //Xiao’s case echoes the disappearance of five Hong Kong book sellers a year ago, sparking questions about whether Beijing was flouting Hong Kong’s Basic Law and breaching the city’s autonomy.// Source: SCMP, 02 February 2017.

• //When asked about Mr Xiao’s whereabouts, Hong Kong police said a family member lodged a request for police help on Saturday before withdrawing it on Sunday after he contacted relatives and said he was safe. He entered the mainland through one of Hong Kong’s border crossings on Friday, the police said. Police added that they would “continue to investigate the case” and had asked the mainland authorities for assistance in determining “the subject’s conditions in the mainland”. The Hong Kong government’s security department reiterated that outside law enforcement agencies, including those from the mainland, were not authorised to enforce the law in Hong Kong.// Source: Financial Times, 01 February 2017.

Different versions of about how Xiao left his residence appeared on the media a week after the incident:

• // Xiao, 45, who was not known to use a wheelchair, was accompanied by about half a dozen unidentified men who were also pushing a large suitcase on rollers. He is believed to have been transported by boat from Hong Kong, eluding border controls, and is now in police custody in mainland China, according to two people familiar with the investigation into his whereabouts.// Source: New York Times, 10 February 2017.

• //Xiao was carried into his own car at the entrance to the Four Seasons serviced apartments in the heart of the Asian financial hub in what appeared to be a « smooth operation », another source with knowledge of the matter told Reuters. The comments from the sources confirmed a report in the New York Times on the disappearance of Xiao, who has close ties to senior Chinese officials and their families. […] The source close to Xiao who said the billionaire left the hotel in a wheelchair said his head was covered with some cloth, but it was not clear what the material was. The source added that as far as he knew Xiao did not use a wheelchair and there was nothing wrong with his legs. A Hong Kong police source who was briefed on the probe into Xiao’s disappearance had previously told Reuters the case was initially treated as a « kidnapping » following a complaint from someone connected to Xiao. But after a review of CCTV footage at the Four Seasons and at the border checkpoint, police concluded that Xiao had voluntarily left Hong Kong.// Source: Reuters, 11 February 2017.

2b) Potential causes for Xiao’s disappearance

Speculations soon gathered over Xiao’s case on the media. As Xiao Jianhua and his Tomorrow Group was one of the prominent business tycoons in China’s financial sector, South China Morning Post reports that Xiao’s disappearance might be related to China’s stock market turbulence in mid-2015 (For the background of the stock market turmoil in 2015, please see the current affairs analysis by Anthony Li) and the case of former vice-minister of state security Ma Jian.

• //A Chinese billionaire who disappeared mysteriously from his luxury Hong Kong hotel over the Lunar New Year weekend is now on the mainland and “assisting investigations” into the stock market turmoil of 2015 and the case of a former top spy, several sources have told the South China Morning Post. A source familiar with Xiao Jianhua’s movements said the founder of Beijing-based Tomorrow Group was “persuaded” to cooperate rather than coerced by mainland agents who visited him at his serviced apartment in the Four Seasons Hotel last Friday. […] The investigation is also believed to be related to disgraced former vice-minister of state security Ma Jian, who came under suspicion of violating Communist Party discipline – a euphemism for corruption – earlier that year.// Source: SCMP, 02 February 2017.

Xiao also has special relationship with a number of party leaders and their relatives, including relatives of Xi Jinping and former political heavyweights such as Jia Qinglin and Zeng Qinghong:

• //In recent years, Xiao has acted as a kind of banker to the ruling class, paying $2.4 million in 2013 to buy shares in an investment firm held by the sister and brother-in-law of China’s president, Xi Jinping. A company he helped to control financed a deal that benefited the son-in-law of a top former leader, Jia Qinglin, The New York Times reported in 2014. Mr. Xiao bought the shares from Mr. Xi’s relatives to help them divest financial holdings following a 2012 report by Bloomberg News that detailed his relatives’ wealth. He did it “for the family,” Mr. Xiao’s spokeswoman said in 2014.// Source: New York Times, 31 January 2017.

• //In January 2013, weeks after Mr. Xi came into power at the last party congress, his sister and brother-in-law sold their stake in an investment firm to a company founded by Mr. Xiao. Xiao later said the move was part of an effort by the Xi family to exit investments, which reduced Mr. Xi’s political vulnerability as he embarked on a sweeping campaign against corruption. But Mr. Xiao also appears to have done business with relatives of other party leaders, including Zeng Qinghong, a former vice president and power broker whom Mr. Xi may consider a potential threat. […] Several companies affiliated with Mr. Xiao were involved in the controversial 2006-7 privatization of Luneng, a huge state-run power company in Shandong Province, in eastern China. Among the others who gained shares was a man named Zeng Ming, according to an exposé published by the investigative magazine Caijing that the Chinese authorities later ordered removed from newsstands. Overseas Chinese news media later identified Zeng Ming as a pseudonym used by the son of Zeng Qinghong, the former vice president. In January 2009, one of the Tomorrow Group’s main companies, Baotou Tomorrow Technology, announced that it would pay about $50 million to buy property in southwestern China from a company headed by the son-in-law of the fourth-ranking member of the Communist Party at the time, Jia Qinglin, company records show. While both Mr. Jia and Mr. Zeng are retired, they have long been seen as important allies of Jiang Zemin, the former president and party leader who continues to wield some influence. Another prominent Chinese businessman who has taken refuge in Hong Kong to stay out of reach of mainland authorities and spoke on the condition of anonymity said that Mr. Xiao’s extraordinary political connections made him an obvious target. Mr. Xiao, he said, was in a special category.// Source: New York Times, 10 February 2017.

• //肖建華最富爭議的則是他與「太子黨」的密切關係。根據紐約時報查閲的資料，2013年，習近平的姊姊齊橋橋及姐夫鄧家貴間接持有的秦川大地投資公司，曾以1500萬元人民幣將其在另一間公司50％的股份出售給肖建華聯合成立的公司。2009年，肖建華實際控制的包頭明天科技曾出資5億人民幣，從時任中共中央政治局常委賈慶林的女婿李伯潭手中，購得雲南麗江一間房地產公司。2012年，一間中國影視公司曾以3000萬美元收購好萊塢特效公司數字領域（Digital Domain），收購資金則來自肖建華和中國人民銀行前行長戴相龍的女婿車峰。紐約時報的分析指出，肖建華曾頻繁投資空殼公司，而空殼公司在中國常用於掩蓋公務人員的股份、為商人的賄賂提供隱蔽，肖建華可能正是藉此與中國政府高層的親屬分享利益。// Source: The Initium, 01 February 2017.

Steve Tsang, director of the SOAS China Institute in London, argued that Xiao’s case is unlikely to happen without Xi Jinping’s approval:

• //Steve Tsang, director of the SOAS China Institute in London, said Mr. Xiao’s extraction from Hong Kong was unlikely to have occurred without the approval of China’s president, Xi Jinping, who has challenged party traditions of collective leadership with a bold drive to consolidate power. Tsang said Mr. Xi might be holding Mr. Xiao in custody to protect himself or to gain leverage against people he “needs to persuade” at the coming party congress to push through his agenda and cement his legacy. “I do not know if the operation was initiated or ordered by Xi, but his consent must have been given, in light of Xiao’s connections with Xi’s family,” Mr. Tsang said in an email.// Source: New York Times, 10 February 2017.

1c) Other news related to Xiao’s disappearance

In another development, other media reports showed that a number of persons and companies were affected by the Xiao’s case in Mainland China. For example, according to the New York Times, officers of the Immigration Department of Hong Kong SAR detained at the airport an information technician Yao Long, who worked for Xiao’s company on 12 February. Meanwhile, According to the Caixin Media, the president of the Beijing-based Securities Daily, Xie Zhenjiang (謝鎮江), was removed from his position as well as being expelled from the Chinese Communist Party for disciplinary violations and now under investigation. The magazine Securities Daily is controlled by the company related to the Tomorrow Group owned by Xiao.

• //The employee currently detained by Hong Kong’s Immigration Department was stopped while trying to fly to Tokyo from Hong Kong International Airport on Sunday night, two people said. The man, Yao Long, worked in information technology at one of Mr. Xiao’s companies and had come to Hong Kong to work on strengthening the company’s cybersecurity within China, one person said. The Immigration Department, which is still holding Mr. Yao, is investigating whether his travel documents are valid, the person said. It is unclear how Mr. Yao would have been able to enter Hong Kong without valid travel documents, but one possibility is that China invalidated the passport while he was in Hong Kong, the person said. A spokesman for the Hong Kong Immigration Department declined to comment, saying the agency did not discuss individual cases. But invalidating a passport would not be particularly abnormal, according to Jonathan Man, a lawyer who advised Edward J. Snowden, the former National Security Agency contractor. “It’s done by other countries; with Snowden, the U.S. revoked his passport — it’s quite a normal way if you want to get a person,” Mr. Man said in a telephone interview. “You cancel his passport to prevent him from going anywhere else,” he said, adding that Beijing has a number of ways to get people to come back over the border.// Source: New York Times, 13 February 2017.

• //The head of a state-backed securities industry newspaper is under investigation for links to controversial financial tycoon Xiao Jianhua, several sources close to the matter told Caixin. Xie Zhenjiang, 63, has been removed from his post as the president of Beijing-based Securities Daily and chairman of Securities Daily Media Co., the newspaper’s business arm listed on the New Third Board for small- and medium-sized enterprises, sources said. Xie has been expelled from the Communist Party for serious disciplinary violations, they added. The newspaper has been ordered to undergo a two-month “rectification” for various business issues, sources said. It is unclear what the rectification is about and whether the company’s normal operations would be disrupted. The shakeup at Securities Daily is linked to Xiao Jianhua, one of the richest businesspeople in China and founder of the conglomerate Tomorrow Holdings Group Ltd., separate sources told Caixin. […] A staffer at Securities Daily, who asked not to be named, told Caixin that Tomorrow Group had obtained absolute control over the newspaper’s business operations and intervened on editorial issues over the years through various affiliates that are among Securities Daily Media’s shareholders. “We have been controlled by Tomorrow Group for many years. It is an open secret at the newspaper,” said the source, adding the newspaper’s business head has always been appointed by Tomorrow Group. Another source from the Securities Daily said by controlling the business side, Tomorrow Group has constantly intervened the newspaper’s editorial decisions. It has forced the newspaper to made public apologies to some companies for negative reports and sent a list of firms to the editorial team asking them not to criticize them. Most companies on the list are subsidiaries and affiliates of Tomorrow Group, said the source.// Source: Caixin, 12 February 2017.

Meanwhile, the chairman of the China Securities Regulatory Commission on 10 February vowed to catch those financial heavyweights:

• //2月10日，中國證監會主席劉士余出席全國證券期貨工作監管會議，在發言中強調資本市場不允許大鱷呼風喚雨、對散戶扒皮吸血，並稱要有計劃地把一批資本大鱷逮回來。這不是劉士余第一次將矛頭直指資本大鱷。今年1月3日，劉士余在證監會稽查局和稽查總隊調研時曾強調，要嚴懲挑戰法律底線的資本 大鱷，逮鼠打狼，敢於亮劍；他還形容要將稽查隊伍打造成一支立場堅定、能征善戰、紀律嚴明的鐵軍，成為中國資本市場的「守護神」和保護投資者合法權益的 「神盾」。[…]數據顯示，2016年中國證監會的處罰力度空前嚴格，行政處罰決定數量、罰沒款金額和市場禁入人數均達到歷史峰值。 // Source: The Initium, 10 February 2017.

1d) Implications of Xiao’s case

Some media commentators discussed the implications of Xiao’s case. For example, Jamil Anderlini from Financial Times argued that the disappearance of Xiao dealt a heavy blow to the image of Hong Kong’s autonomy and investors’ confidence in the independence in executing the law of Hong Kong from the arbitrary police in Mainland China:

• //One of the cardinal rules of the arrangement is that no law enforcement agencies from outside Hong Kong, including those from mainland China, are allowed to operate inside the territory. Coming a little over a year after Chinese agents abducted five Hong Kong booksellers for publishing embarrassing books on the private lives of Chinese leaders, this latest breach of Hong Kong law is a terrible blow to the city’s credibility. Either the Hong Kong government and security services were complicit in the snatching of Mr Xiao or they were negligent in allowing it to happen right under their noses. […] Until now, Hong Kong has been regarded as a haven from arbitrary police and judicial action, but global companies will have to reconsider this in the wake of Mr Xiao’s disappearance. In mainland China itself, his abduction will send a chilling message to the super-wealthy, who already believe Mr Xi has launched a war against them. It will also accelerate the pace of capital flight.// Source: Financial Times, 01 February 2017.

Hong Kong-based commentator Ho Yik-man proposed that Xiao’s disappearance could be the result of the intense factional struggle within the Chinese Communist Party before the 19^th National Party Congress:

• //無疑，在當局眼中，肖建華涉及某個重大案件，那麼，他究竟是此案的主角還是「協助調查者」？根據目前的報道，兩種情況都有可能：一，遙控參與2015年內地股市炒作，獲取暴利；二是前些年與「官二代」合作，涉及官商勾結的貪腐案情。更有可能的是二者兼而有之，肖建華加入的是經濟方式的「反習聯盟」？如果僅僅涉及前者，應當屬於「新賬」。「新賬」說之所以成立，是因為在香港四季酒店(俗稱「望北樓」)避風的內地富豪不是少數，肖在海外避風多年，直至今日才對他有所行動，可能是他近年的舉動觸怒內地高層。如果是「舊賬」，可能涉及的是他過去與「官二代」的合作。肖的家庭背景貧寒，但個人智力超人，是充當「官二代」呼風喚雨、巧取豪奪的最佳「白手套」，將其作為「相關人員」接受調查，說明涉及的被調查案件的重要程度。是否存在第三種情況，第一和第二種可能的結合——肖建華參與的是一個與 「官二代」、民間資本相互勾結，過去二十年間通過種種手段巧取豪奪、視中共第五代集體為對手的權貴利益集團？中共十九大將於今年下半年舉行，很多事件都可以放到這個背景下觀察。1995年的前中共北京市委書記陳希同案、2006年的前上海市委書記陳良宇案、2012年的前重慶市委書記薄熙來案，都是發生在中共黨代會召開前夕。近年形成並迅速膨脹的權貴利益集團更成為權力博弈的利益攸關方。肖建華的背後是否直接或間接與某股政治勢力相連接？這位數百億身家的富翁接受調查，是否暗示若干政治勢力間的廝殺？// Source: Hong Kong 01, 02 February 2017.

Further comments on Xiao’s case in the context of the party-business relationship in Mainland China by Prof. Jean-Pierre Cabestan from the Hong Kong Baptist University and Mr. Willy Lam from the Chinese University of Hong Kong:

• //There is no shortage of examples of other tycoons who have met a similar fate in a country that has the largest number of billionaires in the world: 594, according to the latest ranking of the magazine Hurun. In China, company chiefs need the backing of the Communist Party to get rich, but they also need it to survive. It is a relationship that — when the political winds change — can leave them out to dry, experts say. “Chinese businessmen know their country, and they all know that they must have the support of the authorities,” said Jean-Pierre Cabestan, a professor at the Baptist University of Hong Kong. “Every day, local Communist Party officials receive gifts from company bosses… who need protection.” Without this support, a businessman might have to pay more taxes, for example, “because taxation is very arbitrary in China,” said Willy Lam, a political scientist at the Chinese University of Hong Kong. “If you don’t have official protection, it’s possible that your business might be wiped out, for whatever capricious reasons.” There has been widespread speculation that Xiao’s disappearance was part of Chinese President Xi Jinping’s ongoing anti-corruption drive, which some critics believe has been used to target his political opponents. The campaign was launched after Xi took power in 2012 and has brought down government officials and corporate executives. “There is always the risk of being dragged into the fall of a politician when he is prosecuted for corruption,” said Jean-Pierre Cabestan. “If your protector is doing OK then you make a lot of money,” said Mr. Lam. But if he’s arrested “this may suddenly become a big disadvantage. So it’s a double-edged sword”. […] Especially in China, economics, politics and the judiciary “are all linked,” said Willy Lam. “If you are arrested by the police, there is no guarantee that you will receive a fair judgement.” As a result, many tycoons domiciled themselves in Hong Kong, reassured by the judicial independence enjoyed by the former British colony. But it is not clear how much longer they can shelter there. “Until what happened to Xiao Jianhua… many of these top business people thought that Hong Kong was safe, but no longer so,” said Lam.// Source: Hong Kong Free Press, 04 February 2017.

Ben Bland from Financial Times reported that there is a trend for wealthy businessmen in China to obtain a second foreign passport as a “lifesaver” while enjoying their networks with Chinese officials to do business in China:

• //In recent years, rich Chinese have rushed to acquire residency and citizenship in jurisdictions where they hope to be beyond the reach of Beijing’s security services, while also potentially benefiting from lower tax rates, new investment opportunities and access to better education and healthcare for their families. “There are tens of thousands of Chinese obtaining foreign citizenship every year,” said Denny Ko, an immigration lawyer in Hong Kong who advises rich Chinese clients, adding that Mr Xi’s crackdown has spurred an increase in applications over the past four years. […] China does not allow its citizens to have dual nationality and if they take up foreign citizenship of their own free will, they automatically lose their Chinese citizenship. But in practice many wealthy Chinese do not declare that they have taken citizenship elsewhere, in order to maintain access to the many investment opportunities in China that are excluded to foreigners. At the same time, legal experts say that the Chinese authorities are happy to treat foreign citizens born in China as Chinese nationals if it suits their purposes. “In the past, they thought dual nationality was not a good thing because it could encourage hidden traitors who are loyal to another sovereign,” said Donald Clarke, a professor of Chinese law at the George Washington University. “Now they are starting to think like monarchical governments of old: whether you are under our jurisdiction is for us to decide, not you.” In a notice posted on the front page of a Hong Kong newspaper, which was purportedly from Mr Xiao but most probably from his family, he was quoted saying: “I am under the protection of the Canadian consulate and Hong Kong law” and that “I enjoy the rights of diplomatic protection”. He was appointed ambassador-at-large by the Antiguan prime minister Gaston Browne in 2015.// Source: Financial Times, 14 February 2017.

2. Carrie Lam and John Tsang engaged themselves in electoral campaign after resignation

2a) Carrie Lam’s electoral campaign

One of the candidates for the Chief Executive Election Carrie Lam organized a rally that showed the support she got from the members of Election Committee, from political, business, social, religious, to educational sectors. For a list of advisors for her campaign, please find it here by SCMP.

• //In a question and answer session with the media, Carrie Lam is asked whether the presence of heads of conglomerates and developers on her advisory team means she will favour businesses instead of the grassroots. “My team also comprises [people from] the women’s sector and the social sector,” she says. “But developing the economy is indeed important for Hong Kong.” “Many friends from the business sector wanted to join my team because they feared I would be doing too much on social welfare,” she says, adding that their participation could help dispel the misconception that she would focus on social welfare at the expense of the business sector.// Source: SCMP, 03 February 2017.

According to the Initium, Lam not only successfully mobilized supporters from a wide range of sectors (especially NPC delegates and NPPCC delegates), but also attracted pro-establishment members who had heavily criticized Lam’s former boss C. Y. Leung and drew some members who formerly supported her arch-rival John Tsang. In contrast, the majority of helpers for Tsang’s electoral campaign is a group of former civil servants.

• //林鄭月娥加入政府超過37年，參選前官至政務司司長。她在造勢大會上，公布50人選舉團隊名單，其中34人是選委，橫跨14個界別，動員能力不容忽視。近日一直有傳言指，中聯辦為林鄭月娥「催票」，甚至逐一致電選委，要求他們支持林鄭月娥，她真的是中央屬意人選嗎？整個競選班底之中，有10名全國政協委員、6名全國人大代表，包括范徐麗泰和譚惠珠等，其中陳智思出任競選辦公室主任、陳振彬和陳勇則出任競選辦公室副主任，成為競選辦核心成員。另外，團隊50名成員中，18人與智庫「團結香港基金會」有關，分別擔任顧問、理事、會員和參事。這個基金會由全國政協副主席、前特首董建華牽頭成立。在林鄭月娥的造勢大會上，基金會總幹事鄭李錦芬、顧問管浩鳴、董建華胞弟董建成都有到場。林鄭月娥參選，甚至令近五年一直內訌的建制派，難得一見地團結起來。上屆特首選舉中，參選人梁振英和唐英年惡鬥，建制派分裂至今。被視為「梁振英0」的林鄭月娥，卻成功吸走唐英年的支持者。上屆提名唐英年的全國政協常委胡定旭、陳永棋，以及過往不時公開批評梁振英的前立法會議員林大輝，都成了林鄭月娥的主席團成員或資深顧問。 除了「唐營」，林鄭月娥更成功「挖角」。原盛傳會為曾俊華助選的前金融管理局總裁任志剛、智庫「三十會」成員李律仁，均過檔支持。就連以往狠批林鄭月娥是「福利主義者」的商界，待名單公布後，不滿謠言也似乎一掃而空。 四大地產商之一的恒基地產創辦人李兆基、會德豐副主席梁志堅，以及信和置業主席黃志祥，均出現在競選團隊資深顧問的名單上，3人為地產及建造界別選委。名單內，商界選委也有5個。[…] 事實上，公開為曾俊華站台的都相對「平民化」。除了前公務員外，其他都是母校喇沙書院的師兄弟，包括民建聯創辦人之一方和，為曾俊華出任法律顧問；香港醫療專業人士協會創會主席江明熙，現身曾俊華參選記者會支持。// Source: The Initium, 06 February 2017.

Carrie Lam also announced part of her electoral platform on 13 February on education, business and housing:

• //Chief executive contender Carrie Lam has given some of her policy views on education, economic development and housing. Though other major contenders have published manifestos or even put out updated versions, Lam insisted at a short event on Monday that the three policy areas discussed did not constitute her full manifesto. […] On education, she said she hoped to nurture young people “who are responsible, possess an understanding of the country and passion for Hong Kong.” “I promise if I am elected, I will fully review our education system… to create a stable, caring, inspiring and satisfying teaching and studying environment,” she said. She said the city’s spending on education has been much lower than other developed countries. Her plan will be to add an extra HK$5 billion recurrent spending in education per year, and said that education spending would increase from 21.5 to 22.6 per cent in terms of total government spending. […] Lam proposed new tax measures such as a two-tier system in which companies with an annual profit of less than HK$2 million would pay ten per cent tax on profits, whilst other companies would still pay 16.5 per cent. She spoke of “super deductions” for investments in research, technology, environmental protection measures, arts, culture and design. For instance, for HK$1 million investment in research and development, there would be HK$2 million in tax reductions, Lam said. […] On housing, she proposed an increase in the Green Form Subsidised Home Ownership Pilot Scheme – a scheme for qualified public housing tenants to buy higher tier public housing. She also proposed a new housing supply for first-time home owners. She said there must be voices from the opposition in society but policies must go forward. “It cannot be that today we study land reclamation, and those who don’t like it oppose it; tomorrow we do urban renewal, and some friends do not like urban renewal; the day after we touch country parks, then they oppose touching country parks. In the end, we’ll still be stuck here,” she said.// Source: Hong Kong Free Press, 14 February 2017.

On housing, Dr. Eddie Hui Chi-man from the Polytechnic University of Hong Kong said the Lam’s idea is good but it is unclear which target groups Lam is talking about without concrete details:

• //長策會前成員、理大建築及房地產學系教授許智文亦認為，「港人首置上車盤」構思空泛，「理念是好，但欠缺細節，沒交代實際安排」。他指以往居屋及夾屋兩類資助房屋都有重疊成分，「有重疊不要緊，但要明確指出首置上車盤是要針對哪類收入群組家庭」。他指「上車盤」所針對的目標家庭定位若是居屋以上，本身經濟能力或較佳，有可能亦會選擇私樓。// Source: MingPao Daily, 14 February 2017.

Carrie Lam was rumoured to have the solid backing from the party leaders in Beijing. For example, Zhang Dejiang’s meeting with the representatives of the chamber of commerce in Shenzhen on 05 February sparks speculation about his intention to influence the Chief Executive Election which accepts nomination since February 14.

• //The mainland’s No 3 official Zhang Dejiang has met Hong Kong business heavyweights and local deputies to national bodies in Shenzhen at a critical juncture as the nomination period for the city’s leadership election is set to begin next Tuesday. A source with knowledge of the matter said that Zhang, the National People’s Congress chairman who is also the state leader overseeing Hong Kong affairs, met representatives of the city’s five largest business chambers on Sunday. Sun Chunlan, head of the Communist Party’s United Front Work Department, joined Zhang at the meetings.// Source: SCMP, 06 February 2017.

Local media Hong Kong 01 reported that high-ranked officials from Beijing also met pro-Beijing figures recently. The report quoted one of the attendants saying that the central only sponsored Carrie Lam as the one for the post of Chief Executive, praising her for her ability to overcome challenges of political complexity.

• //《香港01》日前獨家報道，北京高層日內南下深圳會見左派核心，下達中央對特首戰的最新指示。消息證實，身兼港澳工作協調小組組長的全國人大委員長張德江，昨日在深圳會見香港六大商會代表、社團領導及建制派選委，席間表明林鄭是中央唯一支持人選，又稱讚林鄭有「駕馭複雜形勢的能力」。[…] 有建制派人士指，對張德江在特首選舉提名期展開前一星期南下放話，頗為突然，原估計中央官員臨近投票日才會南下「箍票」，但今次出動兩名政治局委員（張德江是政治局常委）拉票，反映中央對特首形勢高度關注。事實上，政界一直有傳林鄭欲以700票強勢入閘，一來壓制曾俊華聲勢，二來亦可營造「西瓜靠大邊」效果，但由於林鄭一直「未數夠票」，令張德江需南下深圳「一錘定音」。// Source: Hong Kong 01, 06 February 2017.

Prof. Ngok Ma from the Chinese University of Hong Kong argued that the support amassed by Carrie Lam may not reflect the reality of the election as many other members of Election Committee have yet indicated their staunch support for her and the show of endorsement is too minimal.

• //馬嶽認為這些現象反映，建制勢力現階段仍未決定如何投票：「他們只是先派個代表，把名字加到名單上，endorse（認可）一下，但領導層沒有現身支持，在政治上等同先不下注的意思。」 至於商界，馬嶽認為林鄭月娥的支持更不穩固：「林鄭月娥將可以獲得的商界支持，全都攤了出來。四大地產商之中，名單只有恆基地產的名字，但李兆基本人沒來。還有新世界呢？新鴻基地產呢？長江和記呢？主席統統沒來。」而即使恆基、會德豐、九倉、信和都有代表加入林鄭月娥競選團隊，馬嶽形容他們的投票取向，未必會像建制派對中央那樣唯命是從：「都是利益關係，可以見風使舵。」[…] 經常為中央「放話」的全國人大代表譚惠珠，出席林鄭月娥造勢大會時，被記者問及會否提名林鄭月娥，她沒有正面回應自己會否提名，只說：「她有許多人支持。」// Source: The Initium, 06 February 2017.

In response to the involvement of the Central Liaison Office in her campaign, Carrie Lam vowed to work alone without its help:

• //Lam said in a Now TV interview that it will be counterproductive if the public believed a “visible hand” was behind the election of a chief executive. “If I know of such a thing, I will avoid giving people such a perception,” she said. Asked if she will publicly ask the Liaison Office not to do so, she said: “There is no basis for me to do that.” “I would tell electors such as Michael Tien and Felix Chung, if you receive such calls and feel uncomfortable, just don’t answer them,” she said. “Or you can say: Carrie has said she is working hard for the election herself – just let her work hard by herself.”// Source: Hong Kong Free Press, 02 February 2017.

In view of the potential intervention from Beijing into Hong Kong’s affairs, another contender for the CE Election Woo Kwok-hing suggested the government to prevent such intervention by having a new local legislation that emphasizes the Article 22 of the Basic Law. Former justice secretary of HKSAR, Elsie Leung said it is not possible and it can only be achieved by the central government exercising self-constraint.

• //Leung [Elsie Leung Oi-sie, the deputy director of Beijing’s Hong Kong Basic Law Committee], also the former justice secretary, said that persuasion and intervention were different. “Anyone can persuade electors in a democratic election, in accordance with the law,” she said on Monday after an online programme. “As long as you do not employ coercion or bribery, this is completely acceptable.” Contender Woo Kwok-hing said there was “nothing wrong” with Leung’s interpretation. He did not agree that phone calls would put pressure on electors. […] Leung also said Woo’s proposal to legislate Article 22 of the Basic Law – to prevent China from interfering in Hong Kong affairs – was not possible. She said the local government cannot set up a law to limit the central government, and it can only be the case that the central government exercises self-restraint in accordance with the Article. Woo said setting up the law would not be intervening with the central government. “It is in the Basic Law, the constitution of Hong Kong… it says clearly that no department of the central government and no province, autonomous region, or municipality directly under the central government may interfere in Hong Kong affairs,” he said. “I don’t understand why it cannot be done.”// Source: Hong Kong Free Press, 14 February 2017.

2b) John Tsang’s electoral campaign

John Tsang also announced his electoral platform on 06 February 2017, and some members of the Election Committee from professional fields have announced his/her endorsement for him. He vowed to re-start the discussion on the political reform and to initiate the enactment of the anti-secession law, Article 23 of the Basic Law.

• //Tsang, who had earlier said it would be irresponsible for the next administration to restart the political reform process if the political climate remained unchanged, made a U-turn by promising to relaunch the process “with the greatest determination and courage” should he be elected. […] Tsang did not mention the restrictive framework laid down by the National People’s Congress Standing Committee in 2014 in his 73-page platform. […] His stance on political reform is more proactive than that of his arch-rival, former chief secretary Carrie Lam Cheng Yuet-ngor, who last month expressed reservations about relaunching the process as it had wasted a lot of energy of government officials in the past few years. Tsang’s moderate stance on electoral reform has drawn applause from some pan-democrats, whose support is vital for him to get the entry ticket to the chief executive election. […] A person familiar with Tsang’s campaign said he was unlikely to get more than 100 nominations from pro-establishment members of the committee, hence the need to woo the pan-democrats. As Lam emerged as Beijing’s favoured candidate, Tsang has seen a number of his supporters switching to her camp amid reports he had failed to get the green light to run from Beijing. Pan-democrats, who secured more than a quarter of the seats on the committee, will probably either nominate Tsang or retired judge Woo Kwok-hing. […] In an attempt to win Beijing’s trust, Tsang said there was no reason to delay the enactment of local national security legislation to implement Article 23 of the Basic Law. Under Article 23, the Hong Kong government is obliged to enact laws to prohibit treason, secession, sedition and subversion against the central government. […] Political scientist Ma Ngok, of Chinese University, believed the legislation to implement Article 23 was the “bottom line” of Beijing that no chief executive aspirant could dodge.// Source: SCMP, 07 February 2017.

In response to Tsang’s electoral platform, SCMP commentator Alex Lo argued that the impossibility of the central government to make compromise on the political framework laid down in 2015 may render Tsang’s promise rather empty and it may be just a way of getting the support from the pan-democrats in order to win the election:

• //He has promised to restart the political reform process for universal suffrage; review the time-honoured automatic appointment of the chief executive as chancellor of all the public universities; and enhance “procedural justice”, rule-based government operations and transparency. The last item is presumably a dig at rival Carrie Lam Cheng Yuet-ngor, who has drawn much flak for authorising the construction of a local version of Beijing’s Palace Museum at the West Kowloon arts hub without prior consultation or tendering. But the main attraction is no doubt the promise to revive the political reform process. That really sets him apart from the Beijing-friendly crowd. It’s an article of faith among many in the business elite and the pro-establishment camp that there is no point in reviving the failed reform exercise. Indeed, they have a very good argument. The central government will not compromise on the so-called 8-31 framework – the blueprint laid down by the National People’s Congress Standing Committee for electoral reform in Hong Kong on August 31, 2014 – that imposes restrictions on the number and qualifications of chief executive candidates, and on the methods of their selection. And there is no way the pan-democrats would ever accept the 8-31 framework. So any attempt to reintroduce reform would not just be a waste of time, but would lead to more acrimony and recrimination. Who wants to risk another Occupy Central? My guess is that Lam also accepts this line of reasoning. But Tsang is no fool. The only way he could win the chief executive race is to get on board with the pan-dems on the Election Committee by promising some kind of reform, or rather talk of reform.// Source: SCMP, 07 February 2017.