This was the week of the start of the annual National People’s Congress, the moment when the system faces the world and the nation, and provides an update on developments. The Premier’s opening speech is always an important marker on the state of play, and on how the system wishes to characterize the situation. But this year, even before that speech, there was a surprising announcement, that the news conference which for 30 years has always marked the conclusion of the NPC, where the Premier, number two in the hierarchy, takes questions from the media, has been been cancelled. And not only for this year, but for the foreseeable future as well. A lot of time has been spent over these past few days on analyzing just what this means, how to interpret it. And here we will simply say that we consider transparency to be a good thing.
In his opening speech, Mr. Lee said that the goal for the year in economic development is around 5% growth. Five is the accepted number, but what the word “around” means, is not clear. The markets, prior to the NPC, were looking for a clear message of support for economic development, substantial measures to deal with the problems the system is facing, and a path to the future that is bright in terms of private enterprise and investment. So far, that message has been muted. But on the other hand, the phrasing on the island has been restrained.
The meetings continue through next week. So we will see what further messages are transmitted, and not leap to any conclusions until the event is concluded. But Bloomberg had a hint that the state banks are going to be made responsible for clearing up the LGFV debt mess. Not great news for holders of ICBC shares.
Anyway, have a fantastic weekend!