Eldon-Online

Vote for Hong Kong

It's election time in the USA. It is where I am right now and as I write it is still Tuesday so it ain't over. Personally I shall be pleased when it is. Not because the outcome is not important, it is, but because of the months and months it seems to have been assaulting our ears in Hong Kong and elsewhere - and the money the process costs in America. Frankly I prefer the British electoral system. Call an election, keep the period for electioneering short and restrict the amount of money it costs.  (Similar to the USA, though, it still doesn't guarantee we get the right person at the top!)

So with elections being topical I started to think, as I often do, about Hong Kong. Not from a political leadership perspective, but from the point of view of Hong Kong's position in the world, in Asia and in China - particularly in the post "American Crisis" era.

 Historically Hong Kong has thrived on crisis; political or economic. It was done by a mixture of entrepreneurial and practical business people with common sense, a facilitative civil service and a hard working labour force. 

 What's changed? 

 Well not a lot when you think about it. The entrepreneurs are still there, university-educated perhaps but with less of the raw gut instinct of their fathers. The civil service is still there and has the ability to perform as before, even if it does not always show the inclination to do so (due partly to the presence and pressure of a less business savvy and more banana-driven and hirsute legislature), and the workforce still seems to be largely willing to perform as hard as before. So although we, along with everyone else, who has been caught up in the "American Crisis”, have some issues, we've nothing to be concerned about long term, right?

Well, maybe we'll be lucky, but this is no time for complacency and it is pleasing to know that at least some in the business community are looking seriously at the subject. Mind you, looking, debating and agreeing are only a part of the sum; action is harder.

 I was delighted to be asked recently to give my views to a group of business people. Delighted because at this stage of career I am pleased to be asked my opinion about something - well just about anything actually.

 I used a couple of stories to illustrate the points I was making but my main thoughts from the first story, in brief, looked at:

 - the world over the next 30 years; a more interconnected, interdependent and international world. A world in which Hong Kong, despite the ties with China and the obvious synergies, must remain international in focus unless we want to become just another city in China - and a small one at that.

- whether we need to ask ourselves some basic but sensitive questions. For example have we become all too comfortable in relying largely on China? Do we realise there are markets in directions other than north? 

- Simply put, Hong Kong is where it is today because of our international focus. Because this is a city where people from different places can do business together. If we want to remain relevant to China, and the world, our internationalism cannot be left behind - unless we want to be left behind.

 In terms of the second story, the salient point was that as Hong Kong moves forward we have to increase our appeal. In the comments above, I talked about our interconnected world. In such a scenario people we need in Hong Kong will only be attracted here if our city offers them and/or their families the best lifestyle. This means being honest with ourselves. Are we sometime soon going to go beyond paying lip service to cleaning up our environment or do we expect to be able to do as little in the next 30 years as the last 30 and still have a city worth living in? Simply put, if Hong Kong hopes to compete going forward, it must be a desirable destination for both business and leisure.

 Lastly I made a few points about aggression; being aggressive in defending our turf and our reputation. There is a re-balancing taking place in world economies. We are becoming increasingly volatile in the global economy - a volatility that is being partly driven by flows of information and misinformation. But in this environment we need to consider what we must do to stay ahead of the competition. 

Once again, these trends raise some sensitive but basic questions for Hong Kong. Questions about how to best fend off the competition, to make sure we stay ahead of ALL those cities in Asia that want what Hong Kong already has? But also questions about dealing with negative perceptions transparently and promptly and aggressively protect Hong Kong's regulatory reputation.

So, a few thoughts on this Election Day but for me - and I hope for those of you who have an interest in your future, when you have an opportunity - Vote for Hong Kong.

"We Will Survive"

With the above words Tony Tan, Deputy Chairman and Executive Director of Singapore's GIC, concluded his remarks at a session of the Institute of International Finance's Annual Membership meeting in Washington DC last month.

I agree.

The world has suffered many madnesses in its history, and if you have never lived through one previously you will always believe that yours is the most extreme, the worst ever, the absolute end of the world, and that we should never allow such a thing to happen again. But are the problems we face today truly worse than previous disasters? I missed the Second World War but my parents did not - so I can only imagine what they and millions of other people, ordinary people, went through. My parents missed the crash of 1929, or were too young to notice. History is littered with examples, experienced I am sure by our ancestors. Disasters of varying degrees of magnitude beset us on a regular basis, it seems, but we always seem to manage to get through it. 

Certainly in such times, and sadly, people who should not suffer - often do so. While others, already at a relative advantage perhaps, find ways to turn the crisis into an opportunity. (And do not be misled into thinking that the word for crisis in Chinese, weiji or 危机, actually means both danger and opportunity; lovely theory though it may be, it seems that whilst wei is indeed danger, ji means something like "incipient moment; crucial point, when something begins or changes. Which could, I suppose, give the idea of opportunity – or it could mean more trouble. But I digress).

In plotting the course of this particular crisis, it does seem that the severity of it has been underestimated all the way down the line, with the result that each Government or Economic Bloc's solution has proved to be nothing more than a band-aid, requiring more and stronger medicine on a regular basis. There are signs, however, that we are getting closer to some kind of stability, albeit still very fragile, and I have no doubt there is more to come.

There are questions that will be asked, once the dust has settled, and I am sure there will be additional regulations imposed as a direct consequence of some of the answers. There will be people considerably more erudite than I am who will provide all the economic arguments you want to read; so many arguments, in fact, you may also become as confused as everyone else. And they will tell you what, in their view, was the cause and the real effect and how it should have been spotted, (some will even tell you that they did spot it, but no-one listened) and stopped.

There will be comments from all quarters on the role of the investment bankers, the politicians (what elections??), and the people who decided they would no longer pay their mortgages for no better reason than there was no recourse to them as borrowers. There will be stories of the inappropriate selling of investment products to the wrong people, of rising inflation and how - in the end - the era of low interest rates that had created an overleveraged society brought about the "American Crisis". (Well, we like to call it that in Asia because we were pretty quickly dubbed as having the Asian Crisis a few years ago. A crisis that taught us many lessons, since heeded).

But, we will survive. We may take many years to return to the sort of free-wheeling lifestyles witnessed in various places, if that is really what we want to do, but I suspect we may be the better for it - until we forget all the lessons learnt and do it all over again.

Forget? Surely not! Perhaps the following few passages will give you a clue - 

"Bank failures we may have now and then, but not catastrophes like these. Our future failures, if any, will arise from imprudent banking, - from the locking up of deposits in unavailable forms of security..."

"The existence of Leeman's (sic) Act is another point in favour of our future outlook. Under that act, the broker who offers shares for sale must have the shares to sell. He cannot execute unlimited bear operations in the shares of any bank which he may select for attack and thus place its credit, and possibly its existence, at his mercy"

" The panics of the future will be influenced to some extent in their direction and force by the action of the public press. What any leading newspaper says today will be repeated throughout the land in a million or so news reports tomorrow"

Hmm; passages (a few of many) taken from "The Country Banker", a book by George Rae (a Scot, of course) first published in 1885! So - exactly what is it we have learnt in 123 years?

Obituary - Farewell to Common Sense

Some time ago a friend forwarded to me an obituary. Not his in anticipation nor, happily, mine. I filed it away because I knew it would come in useful one day - as it had clearly been useful before. An obituary, lamenting the passing away of common sense. I suggest you read it before you go on.

If the structured finance crisis was not already enough to demonstrate the toxicity that a mixture of greed and insanity can bring, then surely we learnt the lesson that paying out millions of dollars in compensation to Chief Executives of institutions that had been brought to their knees was not morally acceptable; particularly to the people in those same companies who had lost their jobs. Didn't we?

Okay, so the amounts are now lower, but the headlines scream as loudly. Today's UK Daily Telegraph newspaper greeted its readers with the headline "Failed bank chief is £2m winner". This, of course, relating to the ousted head of HBOS, who has presided over the failure of a bank where, at the time of the forthcoming merger with Lloyds might see a loss of upto 40,000 jobs, according to some estimates (a little overdone, in my view). Oh - and he gets to keep a job in the new organisation!

In the meantime, across the pond, incredulity remains that a company like Lehman has gone, the folk at Bear Stearns who were rescued thank their lucky stars for achieving "first-loser" advantage, AIG were happy that they were too big to fail (insurers to the Government perhaps?), while toilet paper sellers are still doing a roaring trade around the offices of the likes of Morgan Stanley, Washington Mutual and Wachovia Bank. Everywhere across the globe, speculation is rife about the future - and now the US Government has acted to help shore up the world economies by chucking a couple of hundred billion US dollars at it!

Well, at least the markets have reacted positively today in response to this (rather late) gesture - but the British Government, in case they are uncharitably feeling a sense of schadenfreude,  can take the smile off their faces if they think they have acted expeditiously and smartly; think Northern Rock first of all, and then heed the words of an adviser to Hong Kong's Monetary Authority and to the Bank of England (now former adviser), Sir Charles Goodhart, whose view was that HBOS might have survived if the Government had acted more quickly. Back on the lap of poor old Gordon Brown - blamed again. It seems, they say, that if you meet him, make sure he doesn't wish you good luck!

But is all of this enough? Despite the market rally, have we now bottomed out in the west or is it just a temporary "happy blip" to make us feel better over the weekend? To be followed by the stark reality that on Monday morning we will still not have created any more jobs, an increasing number of people will realise they can no longer afford the rent on their swanky apartments, and the credit card repayments will continue to come under pressure.

No I do not think the world is coming to an end in financial terms, and we will muddle through eventually, but common sense not only suggests we should not live beyond our financial means. It also means that beyond finance, we should not condone (by turning a blind eye) the farce that appears to be Zimbabwe and other similar situations; that hiding behind religion - whichever one - is not an excuse for terrorism, and that many other of todays idiocies (see next blog;  "Non-Compete Clause") could be addressed appropriately by a strong dose of common sense.

Let's hope there is a cure for the apparently deceased.

Another Nice Mess You've Got Us Into....

It was bound to happen. The often touted, but spoken in whispers, demise of Lehman Brothers - and the realisation by the US Government that there is a limit to the amount of taxpayer money you can use to bail out wayward and, dare I suggest it, greedy investment bankers? 

As western nations continue to "prod" Asia and others to get their financial houses in order, we now have more questions to ask about the ability of the west to look after itself, let alone provide advice to the "developing" economies. 

Lehman has gone, strongly aided by the problems that existed in their commercial mortgage book (see my blog of 21 January 2008 - "What, Me Worry? - Yes, Me Worry"). Merrill Lynch has been saved, at a price.

Others look decidedly uncomfortable. AIG currently being the main case in point of course, and by the time you read this they may also be closer to the undertaker than the intensive care ward, but are we really so certain today about the likes of Wachovia and Washington Mutual? By the way, I am not casting doubts about their ability to survive, but they are prominent among the names I have heard over the last 24 hours at the SIBOS Conference being held in Vienna.

It has been an interesting conference, commencing as it did the day after "Black Sunday", but as I might have expected, I do get asked about the impact of all this "chaos" on Asia. In response, I think the best I can do is follow the succinct words of a friend whose biggest concern is the "psychological impact on the region". And I agree. (Ironic isn't it that psychological is made up of psycho and logical - a one worded oxymoron?) But I digress.

 Asian economies, by and large, are in reasonable shape. They continue to grow, albeit more slowly than before, but they grow nonetheless. Meantime, courtesy of events unfolding elsewhere, wealth throughout the region is being adversely affected by the copycat falls in the Asian markets that ape the falls in western markets. Falls in Asia that are not representative of the reality of economic performance. 

Sadly, there is more bad news to come out of all of this, but even now maybe we can learn some positive lessons from the west. For example, recognizing the fact that the future is never a linear extension of the past or the present. Understanding that markets are cyclical, which is a fact you ignore at your peril, as many seem to do. Also, in my experience it is rarely "different this time"; that is, problems often stem from similar roots, historically. And Governments as well as regulators need to recognize the value of understandable and enforceable rules and regulations, as well as the necessity for swift and decisive action. Or even determining, equally swiftly and making clear that they are going to take no action, leaving the market to find its own solutions Through no fault of it's own, Asia has been done a disservice by the "developed" world (well, the USA actually) - a real case worthy of Laurel and Hardy's famous catch phrase that I have used for the title.

Hard Labour, Darling?

Is Gordon Brown facing the first signs of "the final revolt" within his UK Labour Party?

It has been noticeable in recent weeks that beleaguered British Prime Minister Gordon Brown has been looking for party support, which has indeed been coming from at least some of the party faithful. But it has not been convincing to an outside observer, as rather wooden stock-phrases have been trotted out about supporting the best man for the job. Reminiscent of the sort of language used by government and company chiefs when a trusted lieutenant is found embroiled in a scandal - and whose resignation is subsequently, and "reluctantly", accepted. 

The end of last week saw the person generally portrayed as the "grey man" of British politics, Alistair Darling the Chancellor of the Exchequer, don the mantle of honest politician (an oxymoron to some), and tell the British public that they have never had it so bad - economically.

In fact, he said, this is the worst slump in 60 years. And he basically said he needed to tell it straight, and make people aware of the difficulties ahead. All of which seems to suggest that Brown is unwilling to give the bad news himself - and why might that be? 

Clearly bad news is not good for his own tarnished image, or that of a party battered in the by-elections and showing poorly in all the opinion polls. (All forgotten briefly by the news of Britain's Olympic successes, and shadowed for a few days by the interminable reporting on the US elections). But might such news not also reflect rather badly on the performance of the previous Chancellor of the Exchequer who was, of course - Gordon Brown.

The move by Alistair Darling is a brave one. It puts him - at present - alone in his concerns at least within the party. Even Gordon Brown himself said the other day that the economy was "resilient". But it seems to suggest, given his previous non-confrontational history, that he either has very quietly harboured deep-seated ambitions to become Prime Minister himself, or he is "fronting" for a group of disgruntled Labour Party MPs who believe that their only hope to avert a total disaster at the next General Election is to do so with a new leader at their head.

The Labour Party now refers to Mr. Darling's comments as a "gaffe" - not a view shared by Mr "Daring" himself it seems. Somehow I get a sense there is a lot more to this than meets the eye.

Is this the real beginning of Mr Brown's demise?

Korea - What Next?

It was never going to be easy!

President Lee fought his election campaign in 2007 on the basis of change. Against a backdrop of falling investment in the country. With a history of being tough minded but successful, he won the election by the widest majority achieved in a democratic South Korean election. A win which sparked a glimmer of hope amongst people in Korea and in businesses outside Korea. It brought a full email box to me from Koreans working outside Korea who were writing "At last, positive change and we would like to come back".

Fast forward to today and we have a President whose ratings in Korea have dropped to a low level. A major project, The Grand Canal, was abandoned. A waterway project that was not only going to be for practical business  use, but was potentially environmentally friendly for the most part, and would have created leisure opportunities and wet lands, although admittedly financing was an issue. And then to the import of beef, about which significant protests still abound - but is this really about beef-related health issues - or does it go wider than that?

It seems to me that this is more to do with internal issues, seeking an outlet for domestic woes like unemployment, especially amongst the young. A view clearly shared by others that I have spoken to within Korea, but who have not spoken about it publicly for fear, I guess, of being criticised. But if anything was set to derail the ambitions of President Lee in his quest to make Korea a more open and welcoming economy, then the usual media feeding frenzy on the "standard" pictures of Korean demonstrators does nothing to help.

So, what next?

From the perspective of foreign investors, existing or potential, nothing much has changed. Korea remains, to many, as being "anti-foreign" or at the very least "systemically unfriendly" to foreign investors. Views that have been confirmed by various polls of business leaders in such organisations as the UK's Institute of Directors, and by the complete omission of a mention of Korea in the International Herald Tribune in an article about foreign investors in the the region. Not once was Korea mentioned. But I prefer to think of Korea as being less anti-foreign and more pro-Korean. In others words Korean interests tend to be put, or considered above all others. And I see nothing inherently wrong with this attitude, but the reality is that if you want to be a major player on the world economic stage you cannot be perceived, in any way, as being unfriendly towards foreign business.

For Korea, to move slower than the other neighbouring economies or, worse yet, stand still means it is losing ground. Look at the region. A powerhouse economy like Japan, countries which are developing rapidly like China and India. Newly emerging economies like Taiwan, Vietnam and the "next Vietnam" - Cambodia. Established business hubs like Hong Kong and Singapore, which are constantly enhancing their offerings and, in addition to Shanghai the newly emerging Chinese cities like Tianjin, Dalian, Chengdu and Chongqing which all have serious aspirations as business hubs. 

Let's be blunt, I am concerned that Korea runs the very real risk of being marginalised.

When I first became an Adviser to President Lee I made it very clear to all who listened that for Korea to take its place on the world stage, it had to want to be there. I was not there to tell them what to do, but to provide help if I could and if it was what they wanted. The message I am receiving now is one that is divided. For the President, I believe he knows very clearly what needs to be done for his country, and for the future. For the Korean people, they have a choice. They can either see foreign participation in the domestic economy as some sort of threat...and see only the downsides. Or they can realise that such foreign interest is actually a vote of confidence in the future of Korea, and in the many talents of Koreans. It should bring employment, and a wider marketplace for the economy.

I, for one, hope it happens.

Let The Good Times Roll; Crisis Over?

First an excuse. May was manic and blogs, though started, never saw the light of day, bar one. So June will be quieter and more productive, yes? Well if you ignored the "Sell in May and Go Away" warning, then you can quite possibly spend the next month or or so on a quiet beach in gentle relaxation - if your airline is still operating and if you believe you will still have a desk to go back to. If you haven't gone away, hold on to the edge of your seats in Asia, because it could get choppy.

We still have falling markets, rising oil prices, falling food production and rising inflation. We have apparently rigged elections in Zimbabwe (I know, not Asia - just testing!), concerns about chickens in Hong Kong (no, you guess which sort!), mad cows in Korea, the lack of visas in China and the Olympic Games (by the way - who's going to get in without a visa?), a new rapprochement with Taiwan and the list goes on....including an upcoming US election, the result of which - to be debated for the next few months ad nauseam - with no immediate signs of a US economic decoupling from Asia, is going to have an impact on what happens here.

Some of these topics are for later, but for now the "economy" has the floor. I have said before, I am not an economist - and I guess it shows! I am a retired banker whose crystal ball now is no better than it was before I retired - and back then it was flawed - just like the ones used by everyone else. Which is why rather than listening to theories that may or may not be right, I rely on gut feel and taking an interest in what is happening in real time around me, to draw my own conclusions.

In this regard, I have been struck by the kaleidoscope of news, good and bad in the financial markets during the year to date, and the aftermath of the seismic shocks created by the sub prime crisis (which should be better known as the structured debt finance crisis). Yes, say the headlines, the US "nearly" slipped into recession but escaped it narrowly and now things will be better. I hear from some quarters cries of "the market crisis is over!", and "the worst is behind us".

I am pleased to hear it. At least it makes my decision to cement my ties with Hong Kong even stronger, by venturing once more in to the property market, not such a bad idea after all. That said, I have also been given some pretty solid reasons to venture into the jaws of the Dubai property market too, but Hong Kong remains the base!

However, if the crisis is really over why are the airlines needing to increase the cost of flying anywhere, and beginning to drop frequency on routes? Why are the G8 demanding that oil producers increase their output, only to be rebuffed with a comment that the output is sufficient but that consumption elsewhere is over the top - and to note, for example, that SUV sales in the USA are down by about 30%, year on year. Target sold half its credit card receivables to JP Morgan last month - a good deal for both, or was it? Some folk are not so sure. And these are problems at the high end of the market.

Inflation is beginning to affect everyone, and strike action in Europe for example is becoming more common.

What about food? There is perhaps at last some recognition that food, its production and its cost is an issue. People are dying of starvation and, yes, there is some help at hand (although whether it reaches the right places in some countries is debatable). 

And let's not forget natural disasters - as well as the reaction to them. The Chinese calendar for the Year of the Rat, which is this year, was generally not propitious and so it is proving. Myanmar, China, killer storms in the mid-West, Japan's earthquake yesterday, Greece - and we haven't got into either the typhoon or hurricane seasons yet.

Crisis Over? - I don't think so!

What An Interesting Question!

Have you noticed one of the favourite tricks interviewees do on television when they are asked something difficult? They say something like "I am not sure about that, but what I think you meant to ask was ..." - and off they trot into the message they have been itching to impart, with hardly a care for the interviewer or listener.

I got one like that last week, but not on live television.

I was in China and was being asked about the impact of foreign banks in China, since the market had been opened up to allow foreign institutions to take stakes in domestic banks. Had the "experiment" been a success, I was asked. Well, I was able to trot out a whole range of answers about the injections of capital, the expertise that had become available to the investee banks in some cases by the secondment of executives from outside China (although I admit this has not been a universal success). The opening up of the foreign markets, in return, to those domestic Chinese banks, and so on. And the introduction of "best practice" in so far it is understood by foreign banks, in the realms of corporate governance and transparency - taking provisions for bad debts early rather than hiding them. A "no surprise" regime. Not forgetting the important area of credit control.

I really should have noticed the slight narrowing of the eyes and pursed lips.

The conversation continued until it had almost reached its natural conclusion. The interviewer relaxed, as did I. Just one last question Mr. Eldon, if I may? Of course.

"You mentioned earlier that one of the important areas, perhaps the most important contribution that had been made by the foreign banks to China was the introduction of good lending systems and controls over lending. Can you tell me, then, what you think about these expert foreign banks who got caught up in the sub-prime debt market. If they are so expert, how could this have happened - and do they really bring such good practices to China. Should we be worried, or should we let more foreign banks in to teach us?

"Ah!" I said. "What an interesting question - what I think you really meant to ask was...". But in this case, there was little sensible I could add; no message I had been itching to impart.

Message to foreign banks wanting to invest in Chinese banks - tell them about your lack of sub-prime exposure. That will impress them as to your suitability as a partner.

Shattered Dreams?

Tibet. A name on the lips of many today as violent scenes erupt around the world in a carefully orchestrated outpouring of sentiment towards a country that seeks self determination.
No good will come from writing about such an emotive topic, because to support the arguments on either side will result in criticism and misunderstanding on the other. But not to say anything at all, and pretend there is not a problem, really supports the words of Pastor Martin Niemoller (1892-1984) - which read:

When the Nazis came for the communists,
I remained silent;
I was not a communist.

When they locked up the social democrats,
I remained silent;
I was not a social democrat.

When they came for the trade unionists,
I did not speak out;
I was not a trade unionist.

When they came for the Jews,
I remained silent;
I wasn't a Jew.

When they came for me,
there was no one left to speak out.

I believe entirely in human rights. I believe in the freedom of expression; the rule of law; in the ability of anyone to openly practice whatever religion or follow whatever belief they choose - or not to follow anything at all. I believe that no one should go hungry and that everyone should be entitled to clean water, nor should they be discriminated against.

A kind of Utopia, right? A state of unrealism which suggests that the Americans should give back the land to the Mexicans that were taken from them; that Guantanamo Bay should not exist; that Robert Mugabe should without question step down from the office he has held so corruptly for many years; that the Middle East conflicts in Israel, Palestine and Iraq should be resolved and that Christians should be allowed churches in Saudi Arabia. A world in which the military junta in Myanmar should be hunted down and made to hand over the reins of power to those who won it, fairly, in a democratic election.

Tibet, a "cause" that has had the word "celebre" added to it. A cause which seems to have attracted the same "rent a mob" that attends the WTO or the IMF meetings where the advertisements to entice attendees (of the protesting kind) promise entertainment, street parties and some action. A mob which knows how to shout "Free Tibet", but which doesn't know either why it should be freed, what it should be free from or, actually, where it is. I do not belittle the efforts of those who do know what they are talking about, but I speak as a generalisation.

So, we now have a global campaign designed to support a perceived injustice. "Perceived" because, at this stage China has merely said "hands off" without offering any explanations as to its actions or being willing to talk to reach an understanding. Like it or not we live in a globalised world where the actions of our fellow world-dwellers cannot be hidden from view. We need to deal with the politics, but should do so through diplomatic means, not mindless violence.

Meanwhile, if this continues shouldn't we start planning for the protests against the UK in the run up to the 2012 Olympic Games? Wasn't it Britain that helped create many of the problems that Africa faces today by not preparing them properly for democracy; by dealing ineffectually with people like Mugabe; who helped create a "country" like Iraq after World War 1, and who then supported the invasion of that country? Why single out China for attention - just because everyone else is feeling smug in their new glass houses? Come on, keep the ball rolling. I am sure there are some Scots who would be more than happy to join in. Serious? Of course not - but there are plenty of activists out there looking for a cause, whether it affects them or not.

But with all that, I got away from the point.

While politics and diplomacy g>should be taking centre stage in resolving an issue that clearly has much wider implications than I suspect China ever anticipated, try and spare a thought for those athletes whose dream has been to represent their country at the Olympics. Something that, for many, is the culmination of years of determination, sweat and genuine endeavour. Dreams that, as a result of threats, boycotts and other actions that have little to do with sport, may never be fulfilled in full.

And no, this is not an "apology" for condoning issues as serious as human rights, but those dreams also exist amongst those living in desperately poor and/or oppressed countries under despotic regimes. Dreams that might, for just a while, give them a glimmer of hope. Dreams that can so easily be shattered in a world increasingly ruled by the media and the mobs.

Quicksand? - or Slow Mind?

I don't know what it is about Jake van der Kamp! I've only formally met the SCMP columnist once, although I have certainly been on the receiving end of his barbed comments. Once, I recall, was when I publicly questioned the low standards of English in this city - a question that was on the minds of many at that time and, it seems, those concerns have not diminished. On another occasion he took me to task for using a phrase which had by then already slipped into modern usage, even though I did not actually even like it myself very much. It was "Human Capital" - but sadly for Jake he discovered the next day a large advertisement in his own newspaper, announcing the paper's sponsorship of a - yes, you guessed it, "Human Capital" Conference.

Jake has a job to do. He is, I think, meant to be provocative in his column, and in a society like Hong Kong where freedom of speech is still practiced, he is entitled to his opinions and biases. That is what freedom of speech is all about and I am not going to take him to task for any of that but I do wish he would investigate his stories with more care.

Today's Monitor column (Oh! alright Jake, some free advertising for you, even if you don't deserve it) talks about Dubai in terms that suggest he has never set foot in the place. More specifically he goes on to talk about the Dubai International Financial Centre (DIFC). (What's that Jake? You really didn't know I was the DIFC Chairman?)

If I were to respond to each of Jake's rather (at least in my opinion) derogatory comments in turn, we would be here all night and use too much space. He refers to a comment from the Heritage Foundation, which he quotes as reserving some choice words for the UAE, such as "...incompetence and corruption are rarely challenged". Contrast that statement Mr. van der Kamp if you will, by an excerpt from the IMF Article IV Consultation in September 2007 which reads "...Moreover, the development of the DIFC continues to support the diversification and international standing of the UAE's financial sector."

"Building on Dubai's aggressive diversification drive, the Dubai International Financial Center (DIFC) is increasingly promoting the U.A.E. as a regional financial hub. Activities in the DIFC are supported by an impressive physical infrastructure and sound legal framework aligned with best international practices."

The report goes on to state, "The DIFC might best be desc ribed as a future regional financial center. The Center has well defined regulatory and supervisory systems that are on par with other regional financial centers (such as Singapore and Hong Kong)"

Jake's view of the bankers who have registered with the DIFC is no less jaundiced, saying that they are "playing the game" and fulfill their obligations they "...put in three juniors, two of them local hires, give them a pair of scissors..."

Instead of the guessing game Jake, try these: As at February 2008 we have over 11,000 people employed by companies registered in the DIFC; a number we expect to grow to 50,000 in two years, by 2010. The contribution of financial services to Dubai's GDP will more than quadruple from USD3.4bn today to USD15bn by 2015. We are the only jurisdiction in the region with a data protection regime. The securities regulator, the DFSA, was established from the outset as a world class regulator and the list goes on and on...

Is Dubai perfect? No of course not - but then having read your column once or twice it seems that Hong Kong is not that perfect either - in your view. But it is trying hard to be different. It is looking at success stories elsewhere, which is a new departure for them, and it is taking its head out of the sand - whereas I am not quite sure where you are putting yours!