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Saturday, 30 June 2012

Four British banks to pay for scandal!

LONDON: Britain's four biggest banks have agreed to pay compensation to customers they misled about interest rate hedging products, following an investigation by Britain's financial regulator.


The Financial Services Authority (FSA) said yesterday it had reached an agreement with Barclays, HSBC, Lloyds and RBS to provide appropriate compensation following an investigation into the misselling of the products.

The FSA said it found evidence of “serious failings” by the banks and added: “We believe that this has resulted in a severe impact on a large number of these businesses.”

The finding by the FSA of misselling could lead to compensation claims ranging from many millions to several billion pounds from small companies which bought them.

It is the latest in a string of misselling cases that have plagued the financial services industry for over two decades. Banks are already set to pay upwards of £9bil (US$13.96bil) in compensation to customers for misselling loan insurance.

The news will compound problems for a sector that was hit hard on Thursday by news of a record US$450mil fine levied on Barclays for rigging interest rates.

The FSA said the banks had agreed to compensate directly those customers that brought the most complex products.

The products range in complexity from caps that fix an upper limit to the interest rate on a loan, through to complex derivatives known as “structured collars” which fixed interest rates with a bank but introduced a degree of interest rate speculation.

The banks have agreed to stop marketing “structured collars” to retail customers.

The size of the likely compensation was not disclosed but Lloyds issued a separate statement saying it did not expect the financial impact from the settlement to be material. - Reuters

Myanmar warns Suu Kyi to stop calling nation Burma, a British colonialism legacy

 YANGON: Myanmar’s authorities have ordered opposition leader Aung San Suu Kyi to stop calling the country “Burma”, its colonial-era name widely used to defy the former junta.

Myanmar pro-democracy leader Aung San Suu Kyi visits the Louvre Museum on Friday, June 29, 2012 in Paris. Myanmar authorities sternly urged Suu Kyi to stop calling the country 'Burma' and start using the name 'Myanmar.' (AFP Photo/Fred Dufour)

The old regime changed the country’s official name two decades ago to  Myanmar, saying the term Burma was a legacy of British colonialism and implied  the ethnically diverse land belonged only to the Burman majority.

Suu Kyi and her National League for Democracy (NLD) party vigorously  opposed the change, decrying it as a symbolic step by the generals towards  creating a new country.

Berating her for using the name “Burma” during landmark recent visits to  Thailand and Europe, the Election Commission accused Suu Kyi and party members  of flouting a constitution they have vowed to uphold.

“As it is prescribed in the constitution that ’The state shall be known as  The Republic of the Union of Myanmar’, no one has the right to call (the  country) Burma,” it said in a statement, published in state mouthpiece The New  Light of Myanmar.

Daw Aung San Suu Kyi called Myanmar ’Burma’ in her speech to the World  Economic Forum in Thailand on 1 June, 2012,” it noted.

“Again, Daw Aung San Suu  Kyi called Myanmar ’Burma’ in her speeches during her Europe tour.”

“Daw” is a term of respect in Myanmar.

Global leaders also face a dilemma of what to call the country, which is  emerging from decades of army rule under the guidance of reform-minded Prime  Minister Thein Sein.

Britain’s David Cameron calls it “Burma” while recent speeches by US  President Barack Obama also referred to its colonial name.

But his Secretary of State Hillary Clinton chose a more diplomatic path on  a trip to the nation in December, employing the term Burma but saying it  sparingly, generally preferring to dodge controversy by saying “this country.” -- AFP NST

Friday, 29 June 2012

Hong Kong 15th aniversary on return to China

 Maintaining a China identity

Hong Kong SAR chief executive-elect Leung Chun-ying takes over the reins of government tomorrow and throws a challenge to the city to really call China its home.



TOMORROW, the people of Hong Kong and the mainland Chinese will celebrate the 15th anniversary of the return of Hong Kong to China.

Days ahead of the momentous celebration that will be attended by Chinese President Hu Jintao and featuring fireworks, military parade and parachute jumps, Hong Kong Special Administrative Region (HKSAR) chief executive-elect Leung Chun-ying threw a challenge to the city to really call China its home.



During an interview with the Chinese media late last month, Leung said that since the handover in 1997, the city dwellers had developed a sense of belonging with their motherland but it would take a little longer before remnants of the British influence disappear entirely.

New leader: Leung speaking to a group of low-income families at the rooftop of an old residential building in Sham Shui Po District, Hong Kong, in this file photo.
 
“There are two meanings of the handover. First, Hong Kong was legally returned to China and the Chinese government retained the administrative power of Hong Kong by establishing the HKSAR and passing the Basic Law for the ‘one country, two systems’ and ‘Hong Kong run by Hong Kong people’ model,” the People’s Daily quoted Leung.

“On the other hand, Hong Kong was under British control for 100 years. More needs to be done to rid that influence on people.”

For instance, he said, some Hong Kong people would still say that they were “leaving for China” instead of “going to the mainland”.

He cited an example where a Hong Kong saleswoman told her friend on the mainland that she had visited Beijing on her friend’s National Day, instead of referring to the celebration as hers, too.

“These people may not have any political stance when they speak that way. This is probably due to decades of British rule. We will keep on educating our people so that they can better understand the country. But we cannot rush it; it has to be done step by step,” he said.

Leung will begin his tenure as the new boss of the city for a five-year term starting tomorrow, along with his government line-up of Carrie Lam Cheng Yuet-ngor, John Tsang and 18 others.

Besides working on better interaction between Hong Kong and mainland Chinese people, the new HKSAR government has to tackle social problems such as the influx of mainlanders which puts a strain on the city’s healthcare and housing resources.

On the economy, Hong Kong will have to work around the central government’s supporting policies to maintain its competitiveness and improve its people’s livelihood.

In its editorial, the Hong Kong-based Sing Pao daily said the people of Hong Kong had mixed emotions and experienced ups and downs in the last 15 years, but the city was heading in the right direction under the “one country, two systems” policy.

“It was unavoidable that we had to ‘cross the river by touching the stones’. In the past 15 years, we have seen numerous conflict of opinions, political hostility and delayed reforms. No matter how many protests and demonstrations were staged, the majority of residents remain united in steering this boat named Hong Kong forward,” it said.

Oriental Daily hoped that Leung would “clean up the mess” left behind by his predecessors Tung Chee-hwa and Donald Tsang, and, turn around the economy and stabilise the social situation.

“During elections, Leung Chun-ying pledged to introduce a financial development unit if he was elected. Now he has walked the talk by setting up a committee headed by executive council member Laura M. Cha to form the objectives, functions and operations of the unit.

“Leung should invite financial advisers and economics experts to give their input on how to solidify Hong Kong’s status as the world financial centre and to counter future financial crises. Let us see if the Leung administration can lead Hong Kong on a new path of development,” the newspaper said.

Recently, Beijing announced a package of supporting policies such as issuing bourse-traded funds listed on both the Hong Kong and mainland stock markets, encouraging foreign investors to use the yuan for trade settlement in the city and easing restrictions on small businesses run by Hong Kong residents in the mainland.

Peng Qinghua, director of the liaison office of the central government in HKSAR, told China Daily that Beijing had played a key role in maintaining Hong Kong’s prosperity by keeping its promise of autonomy for the HKSAR government.

“The economic achievement in Hong Kong today is the result of its people’s ability to take the opportunities, and their flexibility and diligence. However, it could not have happened without the support of its motherland,” he said.

Peng hoped that the people from both sides would continue to respect their differences, improve communications and deepen cooperation in order to achieve real unity.

MADE IN CHINA By CHOW HOW BAN
hbchow@thestar.com.my


PLA gaining trust in HK

Shortly after being stationed in Hong Kong, Brigadier Zhang Jie said he was asked by a city official why were his soldiers "so invisible".
PLA gaining trust in HK
Soldiers of People's liberation Army pose for photograghs at teh Stanley barracks in Hong Kong earlier this month. Edmong Tang/China Daily

The People's Liberation Army troops had been at the garrison for a month, following the return of Hong Kong to China on July 1, 1997, and many residents expected them to have a high-profile presence.

"I told the official that the reason we were invisible was because we only leave the base when necessary, to not disturb residents," Zhang said ahead of the 15th anniversary of the handover.

This is a policy that stayed unchanged for 15 years.

The garrison, which has roughly 8,000 troops spread over battalions of infantry, engineers, airborne staff and navy personnel, is housed in several bases across the special administrative region.

Due to some differences between the mainland and Hong Kong, which the United Kingdom controlled for more than a century, and the "one country, two systems" policy, PLA troops stationed adhere to stricter rules than those in other parts of China.

"We have to be committed to strict discipline to gain the trust of Hong Kong citizens," said Zhang, who heads the garrison's infantry division.

Liang Yuejia, deputy director of the garrison's political department, explained that there was a lot of suspicion among residents at first that soldiers would get involved in local affairs, such as reacting to street protests.

"But we didn't. Unless the protesters illegally entered our barracks or threatened our lives, we did not resort to contacting the police," he said, adding that they respected such activities according to local regulations.

Even when anti-communist literature was thrown over the walls or staff received harassing calls from political groups, officials said they did not react.

That policy of noninterference has over the years helped the garrison gain a good image among residents.

A poll of 1,006 people by the University of Hong Kong last year found that only about 2 percent of those polled had a negative opinion about the garrison.

"Developing a good relationship with citizens has been the key," said Lieutenant General Zhang Shibo, commander of the garrison. "I think that mission has been accomplished."

Major Wu Qiong, a battalion commander with the garrison's communication station, added: "Before 2000, Hong Kong citizens usually kept their distance. But after years of interaction, many now often say hello. I guess that's because they are aware of our decent style of working and strict discipline."

Increasing openness

Compared with the "invisibility" of the early years, the garrison has greatly increased its openness to the outside world in recent years.

Besides regular training and exercises for army personnel, officials have also been promoting links between Hong Kong and the mainland through various activities, said Lieutenant General Zhang Shibo.

The troops have actively participated in public activities, such as planting more than 50,000 trees, donating 2.5 million milliliters of blood and helping more than 2,600 elderly people and children in care homes.

The garrison has also opened its barracks 23 times to visitors, receiving around 469,000 local people, and held summer camps for children.

The last open day, on May 1, attracted 37,000 visitors, far more than the 28,000 expected and extra free admission tickets had to be distributed. Some people waited in line overnight to get a ticket.

During the open days, guests can view the military facilities and watch soldiers perform combat skills and motorcycling stunts, including drills by the first female special forces of the PLA army.

"One of the reasons why we are gaining increasing recognition in Hong Kong is that the openness of the barracks provides local people with an opportunity to know more about us, as well as a platform for us to serve them," said Lieutenant General Wang Zengbo, political commissar of the garrison.

The activities organized by the garrison also present the PLA, the Communist Party of China and the mainland to Hong Kong residents in a proper way, Wang said. "Their national identity and patriotism have greatly increased," he said.

The garrison has organized seven military summer camps for around 1,200 local teenagers, six exchange activities with 1,600 students from 12 local universities and a military camp for college students. The troops also visited the University of Hong Kong for the first time in 2011 and talked with students.
A total of 215 teenagers participated in the military summer camp in 2011, and the number is expected to reach 260 this year.

"Despite the increase, every school can only send one student, while dozens of others actually want to come, so we'll continue enlarging the camp's scale in future," said Wang.

Tung Chee-hwa, former chief executive of Hong Kong, said the camps influence many families and hundreds of people even though there are only about 200 participants every year, and they also would influence the participants' whole life even they only last for 15 days. 
In 2010, Hong Kong saw an upsurge of young people wanting to enlist in the military. Most of the 4,000 local young people who signed up for enlisting participated in the garrison's exchange activities and military camps.

The summaries written by military camp participants revealed that the 15-day interaction with the garrison provided them with a chance to learn more about the troops, socialism, the Communist Party of China, as well as the strength of the PLA and China, Wang said.

Boosting defenses
With the garrison enjoying a good image in Hong Kong, Zhang Shibo said the focus has shifted from public relations to bolstering military defense.

The mission of the garrison is mainly to exercise China's sovereignty over Hong Kong, safeguard social stability and provide disaster relief and defense campaigns. However, military training is also a priority.

"Since 2007, we have invested millions to upgrade our army's equipment, navy and air force," said the garrison's commander.

Based on Hong Kong's strategic features, the PLA garrison added a special forces unit, an armored battalion and a chemical defense battalion. It has also been equipped with reconnaissance planes, armed helicopters and air defense missiles.

Soldiers receive regular training. More than 20 drills were held in Hong Kong over the past 15 years.
"We aim to test our basic military strength, commanding and organizing capabilities through joint drills," Zhang Shibo said.

The infantry brigade, the garrison's pillar force, has ranked at the top for three years in the military competitions in the adjacent PLA Guangzhou Military Area Command, which has the administrative control of the garrison.

Speaking of the possible challenges the garrison faces, Brigadier Zhang Jie said the garrison "needs to be prepared to tackle possible regional conflicts at all times".

Contact the writer at zhaoshengnan@chinadaily.com.cn

Yu Daimin in Hong Kong contributed to this story.