What's New

Andrew's 2016 Christmas and Year-end Newsletter

May I first wish you and your family Merry Christmas and a Happy and Prosperous New Year! 

 

We all need blessings as 2017 promises to be a decisive year with highly uncertain outcomes, for better or for worse.  Would a Trump presidency usher in a new era of aggressive American dominance? Will it upend the existing Western liberal world order? Will there be a global trade war and arms race? Will the greenback continue its upward trend? Will oil and gas be back with a vengeance at the expense of global responses to Climate Change? What would become of Europe with Brexit and rise of right-wing political parties? How would China adapt to this new global reality? How would the nation transit to a new team at the 19th Party Congress by end- 2017? Would a soon-to-be-elected new Chief Executive be able to turn a new page for Hong Kong?   

 

These are all gripping questions with no simple answers. Perhaps some of the following may offer a little fresh insight and perspective.  

 

Trump, Geopolitics and International Relations

 

Implications of a Trump Presidency (PowerPoint presentation) 

 

2017 will be a decisive year for the world especially China (An in-depth analysis of Trump, Brexit and China) 

 

Trump's transactional dynamics, including on Climate Change, favor China (Live TV interview with ABC (Australian Broadcasting Corporation) 

 

Modernity and Globalization: How new paradigms of connectivity and diversity define a new era of creative disruptions (PowerPoint presentation) 

 

Climate Change and WTO challenge Trump's America on global leadership (An analysis)

 

How may Trump leverage China to make America Great Again (An analysis from an American perspective) 

 

China’s Global Rise: Can the EU and U.S. Pursue a Coordinated Strategy? (Highlights of a Paper by the Center on the United States and Europe and the Brookings Institution)

 

The 2016 Presidential Campaign and the Crisis of US Foreign Policy (Lowy Institute and Brookings Institution analyses)  

 

A framework for U.S. policy toward China (A Brookings Institution Order from Chaos Project Working Paper) 

 

US face-off with Russia over Syria and military threats against Russia and China (Live TV interview with RT International) 

 

South China Sea

 

10 Reasons Why the South China Sea Ruling May Lead to Regional Peace and Cooperation (Op-ed in the South China Morning Post and a Reprint in a management journal. An in-depth analysis of the Hague ruling is here.  My riposte to a critique from the President of Princeton Energy Advisors, New Jersey, provides some further elucidation.)

 

North Korea

 

North Korea's Special Economic Zones (An updated report) 

 

Brexit

 

Why Brexit may not happen after all (An analysis) 

 

GBP post-Brexit (A video-clip take on the British Pound) 

 

Oil and Gas

 

Russian Arctic Oil - A New Economic and Strategic Paradigm (Reports by The Red (Team) Analysis Society, a non-profit geopolitical consultancy)

 

How to win the resource revolution (McKinsey Quarterly research) 

 

National Defense

 

China and Cyber: Attitudes, Strategies, Organization (An in-depth 34-page research Paper by NATO Cooperative Cyber Defence Centre of Excellence (CCDCOE) in Tallinn, Estonia) 

 

The PLA’s Latest Strategic Thinking on the Three Warfares (A Jamestown Foundation research paper) 

 

China Politics

 

Is President Xi's power concentration damaging the country? (An analysis)

 

Economy

 

The Future of US-China Trade Ties - including SOE and debt reform (Drawing from in-depth research by Brookings Institution and Petersen Institute of International Economics) 

 

China's Debt Problem (An abridged Op-ed in the European Weekly Cover Story of China Daily) 

 

China's Manufacturing Strategy - Made in China 2025 (An analytical update) 

 

Challenges of Restarting Growth All Over Again (Feature article in The Global Analyst) 

 

What's Hot in 2017 - Technology Trends (A Report by Global Futures and Foresight) 

 

Chinese consumer

 

The Chinese consumer in 2030 (Latest Reports by Economist Intelligence Unit and McKinsey)

 

What's wrong with Prada? (Live TV interview on Squawk Box with CNBC) 

 

Smart Cities

 

Climate Change Adaptation and Smart Cities - the Case of China - Conference in Qingdao (Two PowerPoint presentations) 

 

One Belt, One Road

 

How Oman can leverage China’s One Belt, One Road (PowerPoint presentation for an international conference at the University of Buraimi, Oman)

 

The evolving role of China in Africa and Latin America (An Economic Intelligence Unit Report ) 

 

Hong Kong

 

Ten ways to turn around Hong Kong's governance and relations with Beijing (Op-ed in the South China Morning Post) 

 

Beijing to interpret Article 104 of Hong Kong's Basic Law (TV interview on Beijing's CCTV (China Central Television)) 

  

Cheer up and chill out

 

Family summer holiday at the Castell-Platja d'Aro, Catalonia, Spain

 

A reportoire of inspirational music, videos, songs and words, There is also a collection in Chinese. 

 

Cross-border M & A propositions

 

You are welcome to send me proposition on a no-commitment basis initially. Relying on my extensive network of contacts worldwide, I will try to match buy and sell sides and facilitate subsequent transactions. Please limit details to a one-page PDF document, including key financial data, photo images, and contact phone numbers and email addresses. 

 

Consultation services

 

Please email me 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 invitations

 

Please email any invitations or proposals for speaking engagements, visiting lectures and tailor-made electives as a visiting/adjunct professor.

 

Business networking and speaking platform in Hong Kong

 

As an Advisor to the Denmark-based Executive Global Network Hong Kong, I welcome you to field 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.

 

RSS feed and weblinks

 

My postings are regularly uploaded under my three blogs CHINAwatch, Publications and What is New on www.andrewleunginternationalconsultants.com  A collection of leading China media and research sites can be found under China Links. Please feel free to save my website on your computer, laptop, tablet, Blackberry, iPhone or iPad as a reference resource. If you wish instant access as soon as my 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 free of charge. This newsletter is uploaded to my website here. You may save it for reference or reading at leisure and to share it on Facebook, LinkedIn, Whatsapp, Twitter or other social media devices. 

 

Courtesies

 

I look forward to your guidance, advice, comments, suggestions, and criticisms. You are welcome 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)

Honorary President, China Hong Kong Economic and Trading International Association (from 28 March, 2016) 

Download 中國香港國際經貿合作協會簡介和組織架構  

Download A brief introduction to the China-Hong Kong Economic and Trading International Association

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               

What's Hot in 2017 - Technology Trends

A report by Global Futures and Foresight, a think-tank and consultancy, identifies the following hot technologies and how businesses could rise to the challenge in 2017 : 

Parallel computing, Zero UI (User-Interface), Blockchain, IoT Security, Workforce (HR) analytics, Robo-bosses, Autonomous analytics, Shadow IT 2.0, Neuroscience and brainhacking, and Energy storage Inflection Point. 

Download What's Hot 2017 -Technology Trends

China's Manufacturing Strategy - Made in China 2025

According to the China Daily, on 19 December, 2016, China's State Council issued fresh guidelines on support for strategic new industries embodied in the 13th Five Year Plan (2016-20) which are slated to produce one million new jobs each year by 2020. Five new pillar industries each with output of 10 trillion yuan ($1.44 trillion) are targeted : information technology, bio-industry, green and low-carbon industry, high-end manufacturing, and digital and creative industry. 

"The government will provide policy support in managerial improvements, intellectual property rights and financing. The government will also help establish an industrial innovation system and increase efforts to cultivate and give incentives to talented people", according to the China Daily. 

On 19 May, 2015, the State Council released China's new manufacturing strategy "Made in China 2025" calculated to grow China into becoming the world's leading manufacturing giant by 2049, the centenary of the founding of the People's Republic of China. Report in the China Daily

The strategy leverages China''s four advantages - Market, Enterprises, Strategy and Talent. It will focus on 10 key sectors: New Information Technology; Numerically-controlled Equipment; Aerospace systems; High-tech vessels; High-Speed Rail; Energy Conservation; New Materials; Medical Devices; Agricultural Machinery; Power Generation. 

Download 'Made in China 2025' to focus on ten key sectors - People's Daily Online

The strategy characterised by marrying manufacturing and information technology, will be guided by Five Principles - innovation, quality, green development, optimising structure, and talent. It is mandated to achieve significant milestones by 2025 and 2035. 

It will start with big projects including national manufacturing innovation centres, intelligent manufacturing including innovative high-end equipment, core electronic devices, high-end universal chips, numerically-controlled machinery, and large airplanes. According to the plan, there will be 15 such innovation centres by 2020 and double this after another five years. Click here

A pictorial diagram highlighting China's new manufacturing strategy follows -

View this photo

The transition path to high-technology manufacturing is unlikely to be smooth. A great deal of reliance on China's current manufacturing powerhouse will remain if sufficient jobs are to turn the teeming millions of factory workers into consuming middle-class. Moreover, the global supply and production chain has become more and more diffused. Nevertheless, competitive manufacturing neighbors like Vietnam, Indonesia and Cambodia remain part and parcel of "Factory Asia" centred on China as the central hub of a global production and value chain. See "Made in China - Global Manufacturing" in The Economist (14 March, 2015)  

How may Trump leverage China to make America Great Again

Donald Trump has won the White House on a rising tide of anger from xenophobic, chauvinistic, blue-collar working-class Americans. 

As President-elect, Trump has chosen several dyed-in-the-wool hardliners for strategy, defense and security. He has picked Climate Change deniers as Secretary for the Interior and as head of the Environmental Protection Agency.  He is ditching the US-led Trans-Pacific Partnership. He has threatened to leave the World Trade Organization (WTO) without better terms Click here.

A Trump America thus appears overtly coercive and money-centric at putting “America First” at the expense of American soft-power and a U.S.-maintained liberal world order. This is worrying both allies and rivals.

Trump pledges to double down on America’s predominant military, including its Asia-Pacific navies. He has not given up aggressive views on China’s currency and trade. How may a gung-ho President Trump build “win-win”, if transactional, relationship with China, slated to be the most important foreign relations in the 21^st century?

The following may offer food for thought.

On trade, without abrogating from the WTO, America may negotiate product-specific agreements with China, for example, on food safety or adequacy of supply of rare earths for strategic industries. America would also benefit from early conclusion of a bilateral investment protection agreement, covering intellectual property rights and other areas of concern.

On Climate Change, the historic 197-nation Paris Agreement has inbuilt momentum Click here. It is likely to endure with or without the United States Click here. China has been taking a lead in de-carbonization, for fear of regime-threatening pollution and energy security. According to a 2016 U.S. Department of Commerce study Click here, there are vast American business opportunities in China for high-voltage transmission, synchrophasor technology, smart cities and smart grids.

An energy-hungry China should stand to gain from its world’s-largest technically-recoverable shale gas reserve Click here. Operational constraints, however, include water-intensity, difficult terrain, and aquifer pollution risks. Additionally, to drive a greener economy, energy efficiency in power plants, factories, cars, and homes, is a top national priority.  American technologies and expertise in these areas are likely to find a welcoming market.

Trump is committed to better infrastructure in order to create more jobs and boost productivity. China’s cost-competitive globe-trotting builders of large-scale infrastructure, including high-speed rail, may come in handy, subject to competitive bids, quality assurance and where necessary, national security vetting.   

On the Renminbi, the Chinese currency, much of China’s perceived market distortion and disruption is due to an immature financial system. As the world’s most sophisticated financial superpower, America’s regulators and think-tanks have much to offer for China’s ongoing financial reform. 

On healthcare, according to a recent U.S. Council for Foreign Relations report Click here, China’s 13^th Five Year Plan (2016-20) provides many opportunities for American pharmaceutical, hospital, and insurance companies. Possibilities are driven by China’s aging demographics, rising incidence of non-communicable diseases, massive urbanization, widespread information technology, and friendly R & D policies and public-private partnerships.

U.S.-China cooperation is possible in attaining the United Nations 2030 Sustainable Development Goals (SDGs) Click here. As China’s financial and economic footprint is ubiquitous in the developing world, such as Africa, both China and the United States would stand to gain in global standing, apart from profits, by joint projects in food security, poverty relief, healthcare, disease prevention, education, and ecological preservation,

North Korea may also offer possibilities for thinking outside the box for US-China cooperation. In North Korea, there is a relatively affluent class representing some 10% of the population Click here. Apart from cronyism, a proportion are likely to be early beneficiaries of wealth-producing special economic zones Click here These are connected with across-the-border Chinese businesses. Given more investments and logistical links, they could play a constructive developmental role. Aside from more narrowly-targeted sanctions, the United States and China could consider stabilizing the regime through economic development. North Korea’s nuclear ambition is but an insurance policy against regime change. Mere sanctions, let alone military coercion, would only worsen such fear. As with Vietnam, national transformation often happens through economic development rather than regime-changing war.

As for the South China Sea, temperature is already lowering as a few rival territorial claimants, including the Philippines, are developing greater rapport with China. There has been recent breakthrough, albeit guarded, in reaching an agreed Code of Conduct between ASEAN and China by mid-2017 Click here. The prognosis is favorable for all sides to set aside (though not give up) their respective historic claims and instead, cooperate on exploration of maritime resources, management of over-stretched fisheries, and conservation of marine ecology. The United States would have a most fruitful role in this scenario.

On the Middle East, although China does not see eye to eye with the United States and is unwilling to get involved in wars, China is intent on fighting Islamic terrorist separatists on her own soil. Opportunities exist for joint US-China anti-terrorism intelligence-sharing and related covert actions. Where the United Nations is involved, China’s sizeable peacekeeping contingent may also assist in humanitarian operations, as in the case of Syria.

On space exploration, Russia and America have cooperated for decades since the mid-70s. This cooperation still continues with the International Space Station (ISS) under the Global Space Exploration Strategy, endorsed by 14 space agencies worldwide including the U.S. and China. Click here As China’s space program is gathering pace, trust-building joint missions are possible, if NASA restrictions are lifted.

Last but not least, Wanda Cinema, which owns the largest cinema chains on the Mainland, has bought AMC and Legendary, the two largest American cinema chains. It has unveiled a 408-acre, state-of-the-art studio in Qingdao, expected to open in 2018. It wants to partner, not to complete, with Hollywood Click here. Its vision is to make films that sell not only in China but across the globe. America’s producers, script-writers, actors and cinematographers should be well poised to tap into this potential goldmine. 

In short, electioneering rhetoric aside, the incoming Trump presidency would be able to leverage China to make America great again, without necessarily compromising America’s global soft-power or turning the US-led liberal world order upside down.

RUSSIAN ARCTIC OIL – A NEW ECONOMIC AND STRATEGIC PARADIGM?

A series of reports by The Red (Team) Analysis Society, a non-profit geopolitical consultancy, expounds upon Russia's grand plan to exploit the massive energy resources of the Arctic and its increasing navigability to boost Russia's global clout at a time when the Arctic's economic and geopolitical potential is being opened up by climate change. 

The Red (Team) Report of 19 December 2016 traces the Russian North's history up to its most up-to-date development. Reference is made to its navigational potential linking up the Russian Ural and Western Siberia with the Canadian North Sea Route. It is noteworthy that Exxon's drilling in the Russian Arctic was halted only by Western sanctions whereas a more Russia-friendly Trump president-elect names Rex W. Tillerson, Exxon chief, as Secretary of State.

It is also interesting that China has been invited to take part in the Russian North project. China has invested $12 billion in the Yamal-Nenets Automous Region and the adjacent Arkhangelsk Port bordering North West Europe. This investment has fresh strategic meaning if it eventually links up with China's maritime "Silk Road" route to Northwest Europe as part and parcel of the One Belt, One Road grand strategy. 

Russia's new and more powerful icebreakers capable of breaking up to 3 metres thick ice are making it possible for Russian and Chinese cargo convoys to ply along the Northern route all year around. This route follows the Siberian coast to and from the Bering Strait to the Russian and European northern ports from Norway to Rotterdam.

Concurrently, the Russian ministry of Defence is rapidly militarising the Arctic, through the creation of the Joint Strategic Command North and the deployment of nuclear submarines and other naval assets. Click here

As I heralded in March 2014, the Arctic Region is poised to change the world. Click here.

The world could become even more closely connected physically if a visionary  China-Russia-Canada-America high-speed rail should ever become a reality. However, the Arctic is also likely to become a proxy arena for great-power geopolitical rivalry.

Either way, it is no surprise that China is quietly boosting economic and geopolitical ties with the Arctic region, especially its most powerful player - Russia. It's also indicative that a new Trump presidency is likely to adjust America's foreign relations with Russia. 

Implications of a Trump Presidency

A PowerPoint presentation on 16 December, 2016 to the Founding Chairmen Group of the Denmark-based Executive Global Network (EGN), Hong Kong, of which I am an Advisory Board Member.   Download Implications of a Trump Presidency

Trump's transactional dynamics, incluing on Climate Change, favor China

My full-length live TV interview on 30 November on The World with ABC (Australian Broadcasting Corporation). I gave a snapshot analysis of why Trump's presidency is likely to change regional dynamics and soft power in favor of China. 

Spainish summer delights, 2016

Family summer holiday at the Castell-Platja d'Aro, Catalonia, Spain, 2016