Ordinary Gweilo

It's not big and it's not clever, it's just a Brit in Hong Kong writiing (mainly) about Hong Kong

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  • Red alert

    Yesterday, all package tours from Hong Kong to Bangkok leaving in the next few days were abruptly cancelled after the government raised its first “red outbound travel alert”

    Large gatherings of people and protests are expected in [Bangkok] in the coming days. The Security Bureau said Hong Kong people intending to visit [Bangkok] should adjust their travel plans. Those already there should avoid protests and large gatherings.

    Hmm…  there were strong rumours that there would be trouble in Bangkok two weeks ago (when the courts ruled on Thaksin’s ill-gotten gains), and that turned out to be a false alarm.  This weekend there certainly will be demonstrations in Bangkok, but the protestors have promised they will be peaceful, and the security forces are well-prepared for any trouble that might occur. Clearly there are areas of the city that you might want to avoid, but it’s hard to believe that tourists will be in any danger.

    It’s fair enough for governments to issue warnings, but if I had my holiday cancelled like that I’d be very upset (of course it wasn’t the government that cancelled the tours, but it might just as well have been). Mind you, I’ve never understood the appeal of going anywhere in a tour group, and if you booked your trip independently you are treated like an adult and can make your own decision (Cathay Pacific have said that passengers can change their flight booking without any penalty).  No such luxury if you booked a package tour.

    This is the same government that has been making such a fuss about Swine Flu, forcing us to waste our time filling in stupid forms long after more sensible governments had realized it was a waste of time, so it’s no surprise.

    Hemlock has more on this (Warning- Warnings Ahead):

    The big excitement for government officials whose duty it is to raise alarms is the first-ever Red Outbound Travel Alert, advising Hong Kong people to avoid prolonged exposure to Thailand on account – as it happens – of matching Red Shirts, the supporters of deposed Prime Minister Thaksin, who are planning a major march in Bangkok in the next few days.

    The OTA system was introduced in October 2009 in response to widespread public whining after Hong Kong tourists suffered inconvenience when protests, also in Bangkok, shut down airports (Yellow Shirts on that occasion).  It covers the 50 countries Hong Kong people are most likely to visit, which is why the likes of Afghanistan and Somalia do not appear.

    Under the easy-to-remember system, an Amber Warning (currently applying to five countries with predominant or large Muslim populations but obviously that’s just a coincidence) means ‘Everything is cool, you can probably relax, but don’t blame the Security Bureau if you get shot or kidnapped because we issued an Amber Warning’.

  • Extreme Makeover – Castle edition

    Watching BBC Lifestyle last night produced a bizarre juxtaposition.

    First there was Extreme Makeover – Home Edition in which a few hundred contractors appear as if by magic to build a brand new house in less than 7 days, and there are nice touches such as a brand new truck being dropped in by helicopter. Subtle it is not. Oh, and American it is.

    Then, immediately after that they had Grand Designs, in which an unassuming (but totally mad) bloke was rebuilding a 14th Century Castle in Skipton, Yorkshire.  In Britain.

    You know that the new house in EMHE will be finished within the week and the family will love it, but there is far less certainty on Grand Designs. In this one they started with nothing more than some crumbling walls – and it was no surprise when one of them collapsed completely – and it took more than two years to complete.

    In EMHE there is no discussion of the budget, and every room has its own big-screen TV. Contractors take part in return for loving close-ups of their company names. In Grand Designs, contractors have to be paid, and you know that the budget is a big issue. Francis Shaw, the mad castle owner, solemnly tells us that if the expenditure on the castle renovation goes over £600,000 he will have to sell and walk away. It does, but he doesn’t.

    If you want to see how it turned out, the castle has it own website, and there might even be the chance for Ruth Watson to do a follow-up show. 

    I might add that neither of these shows was made by or for the BBC, but at least Grand Designs (which was made for Channel 4) does seem at home on a BBC channel, whereas Extreme Makeover – Home Edition has far too many people running around  and shouting.

  • Prudential – bold or barmy?

    A year or so ago, Prudential (a British insurance company) apparently tried to buy 49% of AIA (an Asian insurance company based in Hong Kong and owned by AIG). This seemed doomed to failure for at least three reasons: they didn’t offer enough; they didn’t have the money; and how was it going to work if they owned 49% of their biggest competitor in several markets?

    Now they are back in the toy shop and even more determined to get that shiny new plaything (Prudential gambles on Asia with $35bn deal):

    Prudential, Britain’s largest insurer, shook off the gloom that has dogged the City for the last two years with a record-busting financing package to fund a £23bn agreed takeover of Hong-Kong-based American International Assurance.

    The acquisition signals a major push by the insurer into China and the Far East, where AIA was its main rival, with 20 million customers.

    There’s that pesky problem again – in many markets Prudential and AIA are fierce competitors.  No-one seems sure how that will be resolved:

    It was unclear how the company would operate after Thiam said the AIA brand would remain. AIA has 320,000 tied agents who have long seen the Pru’s 400,000 employees as their main rivals.

    Anyone who has been through any process where your company gets acquired (or "merged"), will know the problems this creates, especially when the acquirer is much smaller than the company being acquired -  and it’s a well-established fact that most mergers destroy value rather than creating it.   Hostile acquisitions of “people” businesses are particularly risky – and you have to assume that everyone in AIA wanted an IPO rather than to be taken over by a rival.  This was a deal done by AIG and the US government, both of whom want as much money as possible as soon as possible, rather than by the management of AIA.

    So there must be a fair chance that a significant number of agents may leave rather than work for Prudential, and you can be sure that other insurance companies will be watching this carefully to see how they can take advantage of the situation.

    Prudential is undoubtedly a big name in the UK, and fairly well known in Asia, but AIA is much better known and has been in these parts far longer.  So there must be an argument for the new company being called AIA.  This would also remove the confusion with Prudential Inc., an unrelated US company, and after all the advertising that has been done in preparation for an IPO, it might be easier to issue new shares in Hong Kong under the AIA name.

    But it almost certainly won’t happen.  Prudential’s top management are obviously feeling very pleased with themselves right now, and the last thing they want is to lose any of the glory.  Whether this will turn out to be a good deal for shareholders (whose interests the directors are supposed to be concerned about) is another matter. 

    Prudential shares fell 12% to 530p yesterday against a slightly higher FTSE 100, while AIG shares were up 6% at $26.30.

    "(The deal) is going to be enormously dilutive," said ING analyst Kevin Ryan. "No one knows exactly what AIA contains or how profitable it is, or how it overlaps with Pru’s existing businesses."

    Pru chief executive Tidjane Thiam rejected concerns that profits could be jeopardised. He said: "Transformational is an overused word, but this deal is truly transformational."

    Well, yes, he would say that, wouldn’t he.  Oh, and thanks to the SCMP for their insightful coverage of this story (one article from Bloomberg, since you ask). 

  • Percy Jackson and the Olympians: The Lightning Thief

    It’s easy to imagine the thought processes of the studio bosses.  Here’s a book about a 12 year old with a difficult home life and some special powers…so let’s sign up that Chris Columbus fellow who directed the first two Harry Potter films.

    So yes, the the film of (take a deep breath) Percy Jackson and the Olympians: The Lightning Thief comes across as a rip-off of Harry Potter.  But don’t assume that the books are the same. Rick Riordan deserves credit for using Greek mythology as the basis for his tales, and with considerably more subtly and wit than Mr Columbus can manage.

    In the book, we learn early on that Percy’s father is absent, and there hints about what the real story might be.  In the opening shot of the film, Poseidon strides through the water and on to the land.  Then it’s off to the top of the Empire State building for a quite chat with Zeus, who accuses Poseidon’s son of being the lightning thief.  So that’s the plot all sorted out then – and yes, there’s plenty more clunky exposition to come over the next 2 hours.

    Bizarrely, Percy Jackson is 16 years old in the film, whereas he was 12 in the first book.  It seems that the money men may have been worried that his age would frighten off adults, so he has consciously been made older and Grover Underwood (his best friend) seems inappropriately leery for what is supposed to be a kids movie.

    The lead actors are unknown, but there are plenty of star names – Steve Coogan, Uma Thurman, Sean Bean and Pierce Brosnan (amongst others), and the first two are fine but Brosnan really needs to stop trying to do comedy.

    Is it really so difficult to turn childrens’ books into movies?  Prince Caspian was stupid, the Golden Compass was poor, and now this.

  • Dangerous claims

    img003About 18 months ago, the government introduced new legislation about nutritional labelling.  There was a lot of fuss made about all the products that would disappear from Hong Kong supermarkets because they claimed to be low in fat or whatever.

    At the time, I suggested that there was an easy solution:

    Surely it must be possible to use a sticker to obscure the claims that are not allowed?  Given that imported products already have locally added labels of one sort of another, this doesn’t sound like too much of a problem.

    Well, here we are in 2010 – and guess what?  Yes, it seems that AS Watson (owners of Park’n’Shop) have invested in some black marker pens to stop us reading that Rice Krispies Multi-Grain Shapes are high in calcium, vitamins and iron.

    I’d love to know how many products have totally disappeared from supermarket shelves as a result of this new legislation.  I’m guessing that it is hardly any.  Products randomly appear and disappear from my local Park’n’Shop so it would be hard to tell if any have gone because of these new rules – but I suspect the big retailers were just crying wolf again.  

  • Avatar is no Toy Story

    It is said that James Cameron spent about ten years waiting for the technology he needed to make Avatar.  You’d think that he might have spent a tiny fraction of that time going to the cinema to watch a Pixar movie or two, just to see how computer animation can be combined with engaging characters and an interesting plot. 

    Yes, sure, there are parts of Avatar that are visually stunning, but that isn’t enough to compensate for the wafer-thin plot and the one-dimensional characters.  Oh, and it’s at least an hour too long.  And was unobtanium really the best name he could conjure up for the stuff that caused all the trouble?  

  • Skeletons in the sliding centre

    I have no interest in the Winter Olympics, but this headline from the BBC caught my attention:

    Britain’s Amy Williams sets a new track record to lead the women’s skeleton after the first of four runs at the Whistler Sliding Centre.

    They have an event called skeleton?  There’s a venue called the “Sliding Centre”? 

  • Be careful what you wish for

    Interesting article in The Independent (When the locals bought their local) about a pub that has been bought by its customers.  

    Ten years ago this corner of northern Salford boasted eight pubs within walking distance of the Star. One by one they've closed their doors.

    Before Christmas the Star nearly went the same way. Robinsons, the brewery, decided to sell up and gave three weeks' notice of closure. But the Star's locals formed a co-op and bought their drinking hole for £80,000.

    This is not an isolated example:

    According to the British Beer and Pub Association 39 pubs are closing every week. A new report from Co-Operatives UK estimates that 2,700 pubs will collapse in the next 12 months, compared to 2006 when there were just 316 net closures.

    Any landlord can give you a litany of reasons for why the industry is so tough; from spiralling energy costs to tax hikes and the smoking ban. But two things get them most animated: the "beer tie", which forces half of the country's pubs to buy drinks from a particular brewer (often at vastly inflated prices), and the multinational companies known as "Pub Cos". Half of the UK's pubs are owned by Pub Cos, the two biggest owning a quarter.

    The dominance of the Pub Cos can be traced to 1989 when the Thatcher government tried to inject competition into the pub industry. Breweries with more than 2,000 pubs were ordered to sell off their excess, and offer a "guest beer". The cleverer breweries worked out that there was nothing to stop any number being owned by a company that didn't make beer. So they set up property companies to own vast numbers of pubs and force licensees to buy off a brewer.

    I know hindsight is a wonderful thing, but I remember wondering at the time whether one or more of the large brewers might decide that there was more money to be made in running pubs, and sell off their brewery business.   As they did.  The Guardian had a good article about this some time ago (Calling time) describing the way these huge “pub companies”operate:

    'We buy beer cheap'" – from the big four breweries, Scottish and Newcastle (now owned by Heineken); Coors; Carlsberg; and Inbev (better known as Stella Artois) – "'and sell it dear, and that's our profit.'" There isn't much space, in this model, for a publican to make money. 

    The Supply of Beer (Tied Estate) Order 1989 and The Supply of Beer (Loan Ties, Licensed Premises and Wholesale Prices) Order 1989 were intended to increase competition in brewing, wholesaling and retailing, by ensuring that no brewer could own more than 2,000 pubs. However, the consequence of this legislation was the creation of stand-alone pub companies, the pubcos, to whom brewers sold their pubs. The pubcos were exempt from the beer order legislation, because they did not brew the beer themselves.

    So the government legislation totally failed to achieve what was originally intended.  In fact it has made things worse by moving control from the big brewers to the shadowy pub companies that are only interested in profits.  Smaller breweries find it just as difficult to sell their products into local pubs, and many landlords struggle to make a living.  It’s somewhat ironic that a Conservative government should have tried to interfere in the market in this way, but hardly surprising that it had such unfortunate consequences.   

  • Kung Hei Fat Choi

    Happy New Year.

  • By-election bores

    In the early 1980s, British politics briefly became exciting. There were a series of by-elections in which Social Democrat and Liberal candidates won some stunning victories, most notably Roy Jenkins in the distinctly unpromising Glasgow Hillhead constituency. He had earlier lost in Warrington, and there was certainly no guarantee that he would win at his second attempt – but he was willing to take the risk of suffering another defeat.

    One of the many problems with the upcoming by-elections in Hong Kong is that no-one is taking any risks. Five legislators from the League of Social Democrats and the Civic Party have resigned in order to force by-elections – which they know they will win, because in a straight fight the democrats always win.

    Just to ensure that this is meaningless, the Liberals (no relation to the British party) have decided not to put up any candidates. This seems like a smart move, because they would certainly lose, but it also highlights the fact that the Liberals are probably the most pointless of all the parties we have in Hong Kong.

    Amusingly (but predictably) the Liberal Party claim it is a matter of principle because they can’t accept the LSD and Civic Party talking about the by-elections as a de-facto referendum (on democracy) and a "popular uprising". An alternative view is that they are just doing what Beijing told them to do, and somehow that seems a lot more likely than a sudden (and unprecedented) outbreak of principles.

    The DAB are likely to do the same thing (for the same reasons), so the five legislators will be back in Legco without even facing any serious opposition.

    Actually, it’s hard to see how anyone resigning and standing in a by-election is ever going to prove anything. A recent example in the UK was Conservative shadow home secretary David Davis, who resigned as a Tory MP to fight a by-election, which he duly won – but can anyone remember the issue that caused him to resign? Did it make any difference? Obviously not (except that he is no longer in the shadow cabinet).

    I think I might even agree with Priscilla Leung Mei-fun (independent pro-Beijing legislator), who proposed changing the rules so that anyone resigning from Legco would not be eligible to stand in any by-election. This would not have prevented the five legislators resigning, but it might have made them think twice about doing so.

    And, yes, the Liberals and Social Democrats had some stunning victories in the early 80s, but when it came to the 1983 General Election, the Tories won a huge majority, and these days the Liberal Democrats are still largely irrelevant in the two party system.