What's New

Andrew's Newsletter March 2016

Greetings and the very best to you and your family in 2016. 

2016 promises to be a year of massive uncertainty. The whole world appears to have been turned upside down, what with a Fourth Industrial Revolution, a slowing and transforming China, collapsing energy prices, and geopolitical tensions flaring up in the world's hot spots. To read the great Chinese riddle wrapped in a mystery inside an enigma, you may perhaps find useful food for thought by checking out some of the following analyses. 

China Overview

Walled In: China's Great Dilemma (An in-depth analysis of Goldman Sach's 74-page report on China)

How Xi Jinping Sees the World ... and Why (An introduction to a paper for the Brookings Institution Foreign Policy Program "Order from Chaos Project") 

2016 promises to be a make-or-break year, as a new China struggles to be born  (My Op-ed on the Insight Page of the South China Morning Post on 12 January). The original version with annotations is here

China and the World: Beyond the Dark Clouds  (My feature article in the February 2016 Cover Story of The Global Analyst, a flagship global business magazine of Hyderabad-based Media-Five Publications Pvt. Ltd., India) 

A Slowing China - Deepening Malaise or Birth Pangs of a New China? (My January 2016 feature article in The Global Analyst) 

The Great Chinese Slowdown and impact on Britain and rest of the world (My interview on News at Ten with ITV, UK's leading TV news channel) 

From Old to New China: Tectonic shifts for Asia in 2016? (An analysis of what promises to be an epochal transformation)

President Xi's 2016 New Year Speech  (My appearance on a CCTV News (English Channel) panel discussion) 

China in 2016 (A analytical review of leading literature on a reforming China) 

Business

Cutting through the noise around financial technology (FinTech) (An analysis separating noise from game-changing dynamics). 

Industries in 2016 - A special report from The Economist Intelligence Unit (An introduction) 

中小型银行的机遇与挑战 - Challenges and Opportunities of Small-and-medium-sized Banks (A special PowerPoint presentation (in Chinese) on the internet revolution facing small and medium-sized banks) 

Urbanization

Changing face of China's Cities (An overview of the fast-changing urbanization landscape in China's 1st and 2nd-tier cities) 

Geopolitics

Trade can do what threats cannot, and bring North Korea in from the cold  (My Op-ed on the Insight Page of the South China Morning Post on 18 February)

North Korea building Special Economic Zones?  (An analysis) 

China's Strategic Calculus in North Korea  (Commentary on a Wikistrat report) 

The Rise of Asia and Its Impact on the Global Order  (An introduction to Asia Society Policy Institute's (ASPI) new policy initiative, explaining why the risks of global war may be over-exaggerated and why the US may need to share power with a "returning" Asia (read "China".) 

 

Signs of China making the grade at the world's top table (An analysis showing that the sands are clearly shifting) 

 

New warfare or power projection - Connectivity  (An analysis of One Belt, One Road as leverage for power projection)

 

Taiwan's January 2016 Elections and Implications for US-China Relations  (An analysis) 

 

China's response to threat of US arms sale to Taiwan (My interview with Radio Sputnik, an international state-owned radio station based in Moscow) 

 

Predictions for 2016 - Wikistrat (A catalog of likely 2016 happenings with geopolitical implications) 

 

Climate Change

 

COP 21 Paris Accord promises to save the world  (A review of literature showing that a New Age is unfolding) 

 

Energy

 

East or West - Where Will Russia Send Its Natural Gas? (An analysis of Russia's hard choices) 

 

Hong Kong

 

HSBC's decision for HQ to stay put in London - The Hong Kong dimension (My live TV interview on Impact, a BBC World News programme). 

 

Chief Executive C Y Leung's 2016 Policy Address on CCTV English (My live TV interview on Beijing's CCTV English) 

 

Hong Kong's Mass Transit link to Mainland China's high-speed rail network (A live TV interview on Singapore's Channel NewsAsia) 

 

Miscellaneous

 

How to accumulate wealth for your family in the 21st century - as inspired by Piketty  (A business re-interpretation of Thomas Picketty's "Capital in the 21st Century")

 

Cross-border M & A propositions

 

If applicable, you are cordially invited to send me, in confidence, concise details of any proposition for cross-border M & As in any business sector on an initially no-commitment basis for either side. These include any businesses, joint ventures, re-structuring, assets or propositions for sale or acquisition, including any stand-alone assets. Please limit details for one proposition to one page as a self-contained PDF document, including key financial data, any photo images, and your contact email, phone number and emails. More than one proposition is welcome. 

 

I will try to match the buy and sell sides, and, where appropriate and subject to mutually agreed terms, arrange and facilitate the subsequent transaction, drawing in any required professional expertise as necessary. 

 

Where appropriate, subject to mutual consent, and free of charge, I will feature suitable propositions, redacted as necessary, on my website, which is regularly accessed in some 30 countries, including some 6,000 professional contacts worldwide.    

 

If your are interested, please send me an email at [email protected] 

 

Consultation services

 

If you wish to consult for any reason including corporate board meetings, you may do so by telephone, Skype or video conferencing. Please email me personally at [email protected] or text my Hong Kong mobile +852 98198987.  

 

I can also be reached on Skype at andrew.k.p.leung, LinkedIn at andrewleunginternational, Whatsapp at (852) 98198987, WeChat at Andrewkpleung, Facebook at andrewkinpongleung, and Twitter at @Andrewkpleung.'

Speaking and lecturing opportunities

Throughout the year, I am open to invitations for speaking engagements, university summer programs, visiting lectures, or tailor-made electives on China as a visiting/adjunct professor, using English or Putonghua as a medium of instruction. I am prepared to stay on any campus around the world for periods of up to several weeks. Please email me with proposals.  

 

A business networking and speaking platform in Hong Kong

 

As an Advisor to the Denmark-based Executives’ Global Network (EGN) Hong Kong, I wish to extend to you the opportunity of fielding a suitable speaker for an EGN event in Hong Kong. This will be entirely at our own cost with acknowledgement of your support or that of your organization, provided that we are not asked to cover any speaking fee, travel or accommodation expenses.

 

Executives’ Global Network Click here

EGN Hong Kong Click here  

 

RSS feed and weblinks

 

This newsletter is uploaded to my website here. You may wish to save it for reference or reading at leisure. You may also wish to share the link with your colleagues and friends on Facebook, LinkedIn, Whatsapp, Twitter or other social media devices. 

 

My postings are regularly uploaded under the three blogs CHINAwatch, Publications and What is New on my website www.andrewleunginternationalconsultants.com   

 

If you wish instant access as soon as these postings appear, just click on “Subscribe to this blog’s feed” under RSS Feed on top of the right-hand column of each blog. Select the appropriate Google feed option. It is absolutely free of charge.

 

A collection of leading China media and research sites may be found under China Links.

 

You may find it convenient to save my website on your computer, laptop, tablet, Blackberry, iPhone or iPad as a reference resource.

 

Cheer up and chill out

 

While the Year of the Monkey started with doom and gloom, you may find joy, hope, inspiration, fun and humor, and perhaps wisdom in an repertoire of music, videos, songs and words, There is also a collection in Chinese. 

 

Courtesies

 

I look forward to your guidance, advice, comments, suggestions, and criticisms. Please feel free to share any of my papers, articles, presentations, and TV interviews with your colleagues or friends. You are also welcome to publish any of them with full attribution.

If you think that I may add value to your endeavours in any way, please let me know how I may help.  If for any reason you do not wish to receive my emails, just ask me to delete your name from my databank permanently.

 

Best personal regards,

 

Andrew K.P. Leung, SBS, FRSA

International and Independent China Strategist

www.andrewleunginternationalconsultants.com   

 

Positions

 

Chairman and CEO, Andrew Leung International Consultants Limited
(Founded in London, now re-incorporated in Hong Kong)
China Futures Fellow, Berkshire Publishing Group, Massachusetts, USA (2011-13)
Brain Trust Member, The Evian Group (global think-tank), Lausanne, Switzerland
Gerson Lehrman Group (Global Experts) Council Member 
International Expert, Reuters Insight Community of Experts, Thompson Reuters
Senior Analyst, Wikistrat, a cloud-sourced global strategic consultancy
Senior Consultant, MEC International (a UK-based global strategic energy consultancy) 
Distinguished Contributor, Asymmetric Threats Contingency Alliance (ATCA) (global think-tank)
Fellow of the Royal Society for the Encouragement of Arts, Manufactures and Commerce (FRSA)
Elected Member, Royal Society for Asian Affairs
Advisory Board Member, The e-Centre, European Centre for e-Commerce and Internet Law
Advisory Board Member, The Global Analyst, India
Hong Kong Advisory Board Member, Denmark-based Executive Global Network (EGN)
Global Commercial Agent, Changsha City, China
Visiting Professor, London Metropolitan University Business School
(The following until 19 May 2010, on permanent relocation back to Hong Kong)
Governing Council Member, King’s College London, UK (2004-2010)
Advisory Board Member, China Policy Institute, Nottingham University, UK (2005 -2010)
Founding Chairman, China Group, Institute of Directors City Branch, London, UK (2006-2010)
Vice Chairman, 48 Group Club, UK (2008-2010)
Committee Member of RSA, London Region, UK (2006-2010)
Visiting Professor, Sun Yat-sen University Business School, China (2005-10) 

 

Included in UK's Who's Who since 2002
Awarded the Silver Bauhinia Star (SBS) in the July 2005 Hong Kong Honours List  

HSBC's decision for HQ to stay put in London - The Hong Kong dimension

My live TV interview on 15 February, 2016 on Impact, a BBC World News programme. 

WeTransfer download

http://we.tl/72ENHH301o

Download Impact_hk_leung_0747_16_2_105_5215454             

Visit the South China Morning Post TV clip on possible risk of remaining in London in the event of a future "Brixit" from the European Union. 

Cutting through the noise around financial technology (FinTech)

A February 2016 McKinsey analysis on FinTech cuts to the quick to separate noise from game-changing dynamics. Banks still matter but nothing will ever be the same again.

According to the analysis, the FinTech revolution is in six theatres - (a) customer acquisition (b) service cost reduction (c) innovative use of data (d) great segment adaptability including millennials, small businesses and the under-banked (e) leverage of banking infrastructure (f) working with regulatory stakeholders. Ability to capitalize on dynamics in these theaters is likely to determine whether a FinTech business model would succeed.

As for banks, the analysis comes up with a recipe of six digital imperatives - (a) data-driven digital insights (b) integrated customer experience (c) digital marketing (d) digitally-enabled operations (e) next-generation technology (f) digital enablers including talent, organization and culture.

So Fintech may eat some of the banks' breakfast, particularly those slow to change. But it also offers opportunities for the more visionary banks to partner or leverage it.

Many are still waking up to an era of rapid change. Digitization is only one of its many dimensions. But this is one that is set to completely revolutionize the banking business as we know it.

For Challenges and Opportunities of Small-and-medium-sized Banks, see my earlier PowerPoint presentation (in Chinese). 

 

East or West - Where Will Russia Send Its Natural Gas?

A January 2016 report by Anca Elena Mihalache of Wikistrat, a cloud-sourced global strategic consultancy, argues that Russia's doesn't have too much choice.

Download Wikistrat-East or West-Where Will-Russia Send Its Natural-Gas

There are pressures from all sides. The China alternative requires the building of massive pipelines and other infrastructure.  The European route is subject to Western sanctions and EU tightening legislation. Supply of LNG is facing increasing competition. Meanwhile, global energy prices are collapsing.   

The report offers the following takeaways - 

• "Russia is not going to make a clear-cut choice between East and West, because it can’t. Moscow must hold onto its European market share and is ultimately willing to comply with legislation – but it won’t do so without putting up a fight.

• The Asian market and LNG projects give Gazprom breathing space in the event that Europe’s demand is not strong enough or it sets too many obstacles; however, competition in terms of LNG is fierce, and prices may fall substantially if supply increases or demand softens.

• Russia will maintain reduced production of natural gas as long as demand is low.

• The future size of Russia’s European market share – as well as the likely destination of Russian gas – will become apparent once a definitive deal is reached on one (or several) pipeline routes: (a) Nord Stream II (bypassing Ukraine to deliver gas directly to German (b) A resurrected Turkish Stream (which was cancelled in December) or (c) Maintaining the Ukrainian route (the cheaper but politically troublesome option)

• Europe’s push for diversification will open the door for LNG imports. Western Europe already imports large volumes. Additional facilities in Eastern Europe, such as in Lithuania’s Klaipeda, are bound to open new, albeit small markets. In time, as inter-connectors are built, markets could grow – especially if Europe is willing to pay slightly more for LNG than it does now for gas that is transmitted by pipeline.

• The requirement of third-party access, along with the inter-connectors to be built in Europe, will give companies that want to invest in upstream activity affordable access to large markets.

• Predictable EU legislation will create a more fair business environment and do away with monopolistic practices.

• EU funding could be available for some natural gas infrastructure projects." 

 

Hong Kong's Mass Transit link to Mainland China's high-speed rail network

Interview on 1 February, 2016 on Channel News Asia, Singapore's top broadcaster, on the Hong Kong Mass Transit Railway (MTR) proposed link to the high-speed network in Mainland China.  

中小型银行的机遇与挑战 - Challenges and Opportunities of Small-and-medium-sized Banks

随着网上银行和移动交易技术彻底改变了银行和销售模式，我上传一个我早先为一个会议特别准备的中文PowerPoint演讲，针对下列挑战和机遇, 以供大家参考.

科技,农村土地改革,和金融自由化如何会把中国银行服务业彻底改变

As internet banking and mobile transaction technology are revolutionizing the banking and consumer sales landscape, I have uploaded a special PowerPoint presentation (in Chinese) which I had prepared earlier for a proposed conference on the following challenges and opportunities -

"How technology, rural land reform and financial liberalization would revolutionize banking services in China"

Download 中小型银行的机遇与挑战

麦肯锡公司 2016年2月的一个分析显示金融科技如何会彻底改变银行业世界

A February 2016 Mckinsey analysis shows how FinTech is set to revolutionize the banking world as we know it.