THE CONSULATE GENERAL OF SWITZERLAND IN HONG KONG

Introduction
“HK has now fully emerged from the Asian financial crisis and has regained its strength and vitality. Our domestic economy has been moving forward with increased momentum, and we are better placed to ward off external shocks. I am cautiously optimistic about this year’s economic outlook.”
(Financial Secretary Henry Tang, Budget Speech of February 22, 2006)

Domestic politics
West Kowloon project: Plans for the West Kowloon cultural district - including the controversial mandate for a canopy - have been scrapped and will again be redrawn because the three short-listed developers were unhappy about changes to the initial proposal. The unexpected announcement stating that the project is going back to the drawing board was made by Chief Secretary Rafael Hui, who is overseeing the project and allowed that "there is a significant gap between public demands and market reality." A developer’s group welcomed the government decision to rethink the West Kowloon project, while a delay in the area's home supply may benefit the district's residential market, according to other real estate interests.
Pro-Beijing camp wary of Tsang's new think-tank: Formation of a think-tank spearheaded by former top officials close to Chief Executive Donald Tsang has sparked fears in the pro-Beijing camp that he is trying to surround himself with allies and further marginalise the camp. They view the establishment of the Bauhinia Foundation as paving the way for a return of the chief executive's former civil service colleagues to the top levels of government if he serves a second term.
Freedom of media wins Legco vote: Legislators have passed a motion calling on the government to respect editorial independence and to defend the freedom of the press. This is part of the debate on the review by the government of public broadcasting (RTHK) in HK.
Bishop Joseph Zen becomes cardinal: The elevation could anger Beijing - Zen has been a harsh critic of the HK and central governments - but it would not affect Sino-Vatican relations on a longer term. Most Catholics see the nomination as recognition of his social stance. During article 23 security legislation saga he was branded by Pro-Beijing camp as a “Pathological Saint”.
Stay out of politics, Beijing warns Zen: The [Chinese] Foreign Ministry yesterday warned HK's Catholic leader Joseph Zen not to interfere in politics, a day after he was named cardinal. “We have taken note of Zen's appointment. We advocate that religious figures should not interfere with politics," said Foreign Ministry spokesman Liu Jianchao in Beijing Thursday. Speaking a day after he was named a cardinal, Zen said while he might try to be more "cautious," he did not think he would change anytime soon. "I'm 74 now, and I'm afraid it will be quite hard to change at this point."
A little something for all: Proclaiming an early victory over the government's persistent budget deficit, Financial Secretary Henry Tang put a little something into next year's financial plan for almost everyone. Homeowners will be able to deduct their interest payments off their taxes for a few extra years. The income of middle-class workers will be taxed at a slightly lower rate. Hospitals will get some money to improve clinical care. And the unemployed will get new help finding work.
Tang defends the lack of giveaways: Budget delivers minor tax cuts, spending boost. I'm looking long-term, says Henry Tang. The Financial Secretary yesterday rejected suggestions he was a miser, after the minor concessions unveiled in his budget failed to win legislators' applause. In one of the shortest budget speeches delivered to the Legislative Council in recent years, Mr Tang announced the expected return to surplus after eight years of deficits - three years ahead of schedule. But he cautioned against lavish spending, citing uncertainty in the external economic environment, and higher oil prices and interest rates.

Transborder affairs
Fortress HK is warned to think nationally, Middleman role push for SAR in row with Taipei: The commission on strategic development issued a paper to its executive committee ahead of a discussion on HK’s role in national integration, peaceful diplomacy, the national economy, social harmony and cultural revival request the committee to consider the roles and responsibilities of HK in the mainland’s “economic, social and political revival” and whether it is necessary to form a new department to coordinate and implement HK’s external relations policies. It mentioned HK’s “historical responsibility” to assist in the integration of the mainland and Taiwan. This is seen as an extension of HK’s role in the diplomatic sphere. It also pushes for fostering patriotism in schools by strengthening the Chinese history curriculum.
Tsang aide tells of Beijing despair at vote: It may have had a negative impact on democratic development on the mainland adding that the democrats have missed a golden opportunity to set an example of gradual democratization for HK and the mainland.
Tap HK’s research skills: After Beijing outlined an ambitious plan to close the gap with developed countries and transform China into a leading technological power, researchers in HK say that some innovative technological projects should be conducted in the city where researchers have a wide international exposure. HK’s expertise lays in biomedicine, logistics, information technology and applying technology to international business.

Legal affairs and human rights
Falun Gong documents 'too sensitive': Documents concerning how four Falun Gong practitioners were placed on a Department of Immigration watch list are too sensitive for open court, Chief Secretary Rafael Hui has decreed. Mr Hui said the release of the documents covered by a court order issued by Mr Justice Michael Hartmann, who is hearing a judicial review brought by the four practitioners in the Court of First Instance, was not in the public interest.

Economy
Third straight gain for economy gauge: HK's business activities picked up for the third straight month in January, thanks mainly to strong increases in output and new orders, according to the purchasing managers' index. The Brunswick PMI stood at 53.7 for January, the highest in eight months, up from 52.6 in December 2005, said NTC Economics, which published the figures from Brunswick Group and the Chartered Institute of Purchasing and Supply HK. A reading of more than 50 indicates the economy is expanding. "These figures indicate that the HK economy remains robust and is on course for continued growth for at least the next six months," said Ray Bashford, a partner at Brunswick Group HK.
Flat rents likely to rise 15 % as foreign firms lift demand: HK apartment rentals are likely to rise by about 15 % this year in view of growing demand, according to Midland Realty executive director, Vincent Chan Kwan-hing. Demand for rental accommodation remained on the rise because HK's economic rebound lured more multinational corporations to open offices in the city last year and this trend would continue, he said. "Multinational companies are expected to increase housing allowances to keep quality staff as businesses grow," added Mr Chan, saying this would help push up rents.
Jobless rate falls, but so does labour force: HK's unemployment rate dipped to a 52-month low of 5.2 % last month, the government reported yesterday. But behind the impressive headline figure, down from 5.3 % in December, the news on the unemployment front was not so good, as the drop in the jobless rate was accounted for by the reduction in the labour force. There were 174,000 people without jobs last month, about 8,000 fewer than in December, the government said. It is the first time the number of unemployed has fallen below 180,000 since August 2001.
Economy has grown, but not incomes: Figures to be released by the financial secretary in Wednesday's budget are expected to show that HK's economy is bigger than it was at its peak in 1997. But people are still, on average, making less money than eight years ago, and some economists are pointing to a widening gap between the rich and the poor.
Julius Baer ready to play waiting game: Julius Baer Holding will take at least a couple of years before it begins to recoup the investment it is making in the new private-banking markets of Asia and Latin America. "I think we will have to wait for two or three years before we are fully loaded until we get our investment back," said Alex Widmer, head of the Zurich-based bank's private banking operations. Widmer is in charge of beefing up the operations, most notably in Asia, where Julius Baer has only a small presence through a recent acquisition. At the same time, Widmer said, his priority is to "stop the offshore bleeding," or slow seepage of client assets out of Switzerland that has caused Julius Baer to report net outflows in recent years. Julius Baer is looking to new markets to offset that. Widmer has already hired numerous employees but cautions that costs will run high.
HK to be new home of Asia's biggest air show: HK has brushed aside stiff regional competition to win Asia's biggest air show to be held every two years from September 2007. The four-day event could potentially contribute HK$ 2 billion to the economy every two years. Air show organiser has chosen HK over Shanghai and Bangkok to host the show, which has been held in Singapore for the past 25 years.
Economic outlook bright for city, says IMF: The International Monetary Fund gave HK an economic thumbs-up, predicting a return to a balanced budget this year, growth in line with government estimates and a sharp fall in the jobless rate to below 4 %. But it also warned that an ageing population, a narrow tax base and long-term unemployment remained key challenges.
Millionaires add to wealth, get younger: The wealth of HK dollar millionaires surged last year, even as their numbers remained stagnant, according to a Citibank survey. HK's 274,000 millionaires increased their wealth 17.6 % on the back of strong economic growth and a bullish stock market, the annual Citibank HK Consumer Wealth Review found.
Retail sales rose: HK's retail sales rose 6.9 % to HK$ 19.3 billion year-on-year in December 2005. It continued the growth recorded in October and November, which saw sales rise by 4.2 and 4.8 %, respectively. For 2005 as a whole, retail sales increased by 6.8 % in value, or 5.9 % in volume, over 2004.
HK should broaden tax base, says ratings firm: Despite improvement in its financial strength, the HK government still needs to broaden its tax base to fix its revenue structure, credit rating agency Standard & Poor's said. "In the medium term, establishing a sustainable revenue structure is still dependent on broadening the tax base," S&P credit analyst Ping Chew said. "Spending pressure remains high, particularly in relation to aging, health care and redeveloping the economy, including education." Financial Secretary Henry Tang said in his budget speech last week that the government will launch a nine-month public consultation by mid-year on a goods and services tax. If such a tax were adopted, it would not be implemented before 2010.

Health
Warning on massive bird flu outbreaks: The state agriculture minister has warned that further large-scale bird flu outbreaks are possible, after the mainland reported two more human cases and another poultry outbreak at the weekend. The warning was followed by the release of a set of emergency plans issued by the State Council. In view of the current situation, the possibility of a massive bird flu outbreak cannot be ruled out," Du Qinglin was quoted by state media as saying yesterday.
Bird flu scare over smuggled poultry: Three people from a village near the border were in hospital isolation being tested for bird flu after having eaten a chicken, smuggled in from the mainland that had been housed with another that died of the H5N1 virus. The news fuelled fears of an outbreak among poultry on HK's doorstep in Guangdong, as preliminary tests showed another wild bird was infected with the deadly virus.
Finally, a deadline for ban on live chicken sales – 2009: Live chickens will be banned from HK's wet markets by 2009, more than 10 years after the idea was first flagged, a senior government source revealed. The source said the Health, Welfare and Food Bureau would next month present the Legislative Council with a timetable to phase out the sale of live chickens, to coincide with the plan for setting up a central slaughterhouse in the northwest New Territories.
Property sector will be hit by smoking ban, says agency: Property became the latest industry to claim it would be dealt a severe blow by the government's proposed smoking ban. An executive of one of the city's biggest estate agencies said property prices could plummet as bars and restaurants lost business and closed because of the ban. But the chief of another big agency disagreed, saying entertainment venues were facing intense competition from Macau and the mainland and were using the looming smoking ban as an excuse to shut down.

Environment
Warning of disaster from HK's pollution: Pollution fighter Anthony Hedley has called for a 10 points plan to clear HK's air before a disaster hits the city. His plea was sparked by pollution levels earlier this month when nitrogen dioxide and particulate levels in the air reached 150 to 200 micrograms per cubic metre. Professor Hedley, chair professor in community medicine at the University of HK, said the levels were more than seven times those considered as dangerous in Canada and New Zealand for particulates, and more than five times the WHO European guideline for nitrogen dioxide.
No more river polluters, vow mayors: No more polluting businesses or factories will be built on the banks of the Dongjiang, the river that supplies most of HK's drinking water, two Guangdong mayors have vowed. "Due to various historical reasons, there were some very heavily polluting factories on the riverside, but we [the government] have relocated two thirds of them, and closed the remaining third," Huizhou Mayor Huang Yebin said on the sidelines of the Guangdong People's Congress.

Macau
Macau property race is on despite risks: At a convention in Shanghai, a group of investors with US$110 billion (HK$858 billion) in funds between them asked a property (and decisions) expert where in Asia he would put his money. "Without hesitation, Macau," answered Peter Barge, author of The Little Book of Big Decisions on how to be decisive. Barge, also Asia head of property consultants Jones Lang LaSalle, has two "opportunity funds" for property in the former colony, which is rushing to build huge casino resorts to draw mainland gamblers in their millions. Other foreign investors are following. What was once a speculative residential property market, supplied by local developers, is starting to attract bigger international names interested in building shopping centers, offices and flats. Citigroup has hooked up with private developer Macau Land to build two luxury high-rise apartment blocks.

Varia
Muslims march to protest at cartoons: Around 3000 Muslims marched peacefully TST to protest Danish cartoons.

Press articles related to Switzerland
« Medicine for the soul »: (Post Magazine, 5 Feb. 2006): The father of LSD, Albert Hofmann employed by Swiss chemical firm Sandoz Laboratories, has seen his «medicine for the soul» transformed from scientific wonder to outlawed, feared street drug. In 1938, the doctor synthesised the 25th chemical: lysergic acid diethylamide (LSD). Sandoz was keen to find a use for this new compound and Hofmann thought it could have an important role to play in psychiatry. After animal tests showed it to be virtually non-toxic, it was made freely available to qualified clinical investigators: “Properties: causes hallucinations, depersonalisation, reliving of repressed memories and mild neuro-vegetative symptoms”, read the Label on the bottle
Vastness, magnificence and simplicity: (Weekend Standard, 21 Feb. 2006): Marc Progin, born in Switzerland, living in HK for 28 years, was initially interested in endurance sports; this led him to a 7500 km bike journey across a land without fences: Mongolia. The exhibition, held at the Foreign Correspondents’ Club, attests to what he saw and how he saw it. “The physical journeys are not what I want to elaborate on,” he explains. “It’s the resulting interior voyages that interest me”. (FCC, 2 Lower Albert Road, Central, HK, from 21.02 until 20.03.2006)

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