Transcription
And when the United States wants to beat up on China, and you try to make that relationship better, you're going against the US government. You think you will succeed? I don't think so.
And in fact, nowadays, it is becoming unsafe to live in many parts of the world. I told you I went around the world twice in the last six weeks, and I saw homeless people in tents all over the place in many cities and anti-Asian sentiment. It is just not safe.
Most people are very shortsighted. Number one, that's a problem. The second thing is they're very emotional. That's another problem. I feel bad for those foolish people who moved out of Hong Kong in the last three years. I think most of them will regret this decision within a short period of one, two, three years.
Fore speech. Fore speech. Fore speech. For YouTube. Uh, I was with two very senior, very, very senior Singaporean friends of mine, dear friends of mine whom I respect tremendously. We spent two days together in Italy last week, uh, ten days ago, and they both are of the opinion that the, the, the heights, shall I say, of, uh, Singapore benefiting from the COVID and, you know, the, the, the plight of Hong Kong, that's already at the tail end of it. And by the way, Singapore, the government is really brilliant, brilliant, brilliant. They're the top brains, and the top brains, uh, uh, uh, they are so smart that they are too smart for their own good, often. And, you know, they change policies very quickly. And so, you, you know, you go to a place that the government policy can change with a stroke of a pen. And so, you know, uh, it's not a long-term solution.
I think the grass is always greener, uh, across the fence. And so, a lot of people say, see the, the ills of Hong Kong, and there's plenty of it. And I, for one, very few businessmen in Hong Kong criticize the local government. I, for one, have been criticizing the Hong Kong government severely, and you ought to hear what I say privately to these guys.
>> Yeah.
>> But beyond that, uh, the grass is always greener. You always know your own ills far better than you know the ills of your neighbor.
>> Right?
>> And, and frankly, as I look around the world, and I traveled a lot, as you know, uh, the ills of the rest of the world to which people from Hong Kong have wanted to, to, to, to immigrate. I think they have no idea what they are getting into.
>> Y.
>> I was in London not long ago. They have the, the Hong Kong people who move, they have no idea. And this is, I mean, talking about investment bankers, talking about markets, talking about the, you know, the, the, the, the trend. You are jumping into a sinking boat. Singapore is not sinking. Okay. Some other people are sinking. Singapore is doing fine. Other places are sinking fast, and you jump into it. Short-term thinking, emotional, and really very short, uh, of knowledge, uh, short of understanding of the world of many other countries. Uh, and so I can sympathize with those people who had a hard time with Hong Kong. I can sympathize with them. But on the other hand, those people, I guarantee you, don't know the ills of the, the places where they're going to. And, uh, I should say, welcome back.
>> You welcome them back.
>> Uh, but I'm not sure if we should, but that's another subject.
>> That's another subject. Um, how are we going to get them back or get that money that might have fled back? I mean, we've heard the grand promises of the Greater Bay. I went over to Macau recently with another reopening of Macau and the beautiful bridge that's going to link Zhuhai and of course Guangdong and Macau and Hong Kong. It, it's, it's under, under, underused right now. Obviously, there's border controls and this and that. Do we have to wait until 2047 before we can travel freely around this region that you keep on touting as being the biggest, one of the biggest per capita GDP areas that will ever be in a manufacturing hub?
>> I don't know if it's the biggest, uh, per capita GDP, but could.
>> The total GDP is very, very big. That's true.
>> I think, you know, the GDP will be fine. I don't think there's a whole lot of things to worry about. So, uh, you know, would I bet on this region? You bet I will. Uh, tell me another area and I would tell you why not. Uh, and some of them I may not want to say it public here. You buy me lunch, I will tell you place by place around the world. I just went around the world twice in in about six weeks. So I've been to a lot of places and frankly, I, as I look around, I said, there are very few places that are as good a place to invest, uh, as in Hong Kong, GBA, and indeed the rest of,
>> China.
>> Then okay, I know we're not going to talk about empty skyscrapers. Where does Hong Kong need to improve though? I mean, we all know there's a disenfranchised youth, a section of disenfranchised youth. Not all of them are, but not everyone can go be investment bankers or not everyone can.
>> Thank God.
>> Uh, what does Hong Kong need to do better?
>> Every government can do far better. Every government. And so you, you talk about, you know, uh, people moving out and so forth. Uh, I grew up in the late 60s and early, I went to university in the late 60s and early 70s in the United States.
>> California State.
>> Yeah. I, I was in California. Yes.
>> And those were the days of Vietnam War. And, and, and my friends, my classmates all did three things: free love, drugs, and anti-Vietnam war. Okay. And a whole generation was wiped out. A whole generation. Many, I, I know people who smoke dope because most of my classmates, I look into their eyes. Hey, look at me, Stephen. I look into their eyes and I said, "That guy has been smoking dope the night before."
>> Yeah.
>> And so a whole generation was gone. In 1974, I entered MBA school, uh, at USC, and that was the highest number that my class was the, has the most applicants in a long, long, long, long time. Why? Because the remnants of the anti-Viet war era and free love hippie culture, the remnants of it who did not smoke enough dope to burn their brains all got into MBA schools. And so for history to see a lost generation, it is a common occurrence.
>> Yeah.
>> It is a common occurrence, sad as it may be. And I have been seeing this for the last 20 years. I said Hong Kong young people are now today relying on, uh, on government handouts. Uh, they have a, a sense of entitlement. Right? That's exactly what got a lot of economies in human history in modern human history into trouble. And Deng Xiaoping says we should never repeat the over-socialism of Europe. And so I saw the last 25 years, the, the over, uh, uh, socialistic policies and the spending of the government in social spending went through the roof. When Chris Patten came in 2000, uh, in 1993, 92, 93.
>> 92, 93.
>> That number went up already. And then after 1997, it went up to the, to the sky. And I said, this is not a good thing. We may be a little bit too stingy in the past. The British were. They don't want to, they want to take money back home instead of spending it locally, I suppose.
>> But it does engender a kind of, uh, fighting spirit in the young people.
>> There's a future we want to get better. Of course, 1997, we used to live in borrowed time and borrowed place. Uh, but we just never transitioned it. We jumped from borrowed time, borrowed place to go somewhere else. And, and that's a, a big mistake. And so, you know, I'm sorry to say this, that lost generations are nothing new in human history. And there's nothing you can do when a, a person, uh, in the first 18, 21 years of his or her life has that mindset ingrained in their head. It's very, very sad. So let's hope that the next generation will not be, uh, the same as the last generation. And I'm so glad that I am not in that generation.
>> Yeah, it takes self-initiative to pull yourself out of that lost generation. I mean, I was born in '66, right in the middle of that. Uh, and I have two, two, my two eldest brothers both went to Vietnam. One is still a hippie living on a shack on a river. He's almost 80. And the other brother worked part-time with you in Shanghai as an architect. Full disclosure, one of my brothers worked with Ronnie a long time ago.
>> They did Grand Gateway 66 in Shanghai.
>> Yeah. So, so completely opposite directions, but it's up to the individual. Obviously, you mentioned socialism, so I got to pivot to China a little bit. Um, what's going to be the answer to get US and China back talking? Blinken's heading there this weekend. That's a good step. What's, what's going to bridge the East-West divide right now?
>> Nothing. Nothing. Do we need to bridge it? Do we need an empty bridge to Macau?
>> I wish you can bridge it. We all wish that you can bridge it. But it's far bigger than you and me. When the number one country in the world, America, is not the strongest country in the world today. No, America is the strongest country ever mankind has ever seen. And when the United States wants to beat up on China, and you try to make that relationship better, you're going against the US government. You think you will succeed? I don't think so.
Right. So, anybody who looks at these small blips, you know, oh, Blinken is going to China. Pardon my French. Total B. Something. You look at what they do. It is not what they say. They just instigated the, the, the, the Canadians to leave, uh, to, to leave the AIB. Do you think the Canadian decided it on its own? I was in Italy. I was with Mario Monti. We were talking about, uh, uh, uh, uh, uh, them leaving the Belt and Road Initiative.
>> Right.
>> And you think that Italy made that decision on its own? You are either naive. If you believe so, then you're either. Do you believe there's, you believe I mean, the United States has talked about economic coercion coming from China, where China's come back and said it's diplomatic coercion from the United States. You've seen it with the French shoring with chip manufacturing going to Japan, going to Germany, going back to the United States. Do you think this is all being driven by coercion by various powers?
>> You, I'm going to ask you, Stephen. I just asked the questions. I'm asking my answer is Steve. What do you think?
>> I cannot say.
>> Okay. Steven Angel fireside.
>> I don't think, I don't think you're that naive. Right, Stephen?
>> No, I'm not that naive.
>> Good. Thank you. You answer yourself and you answer my question.
>> So, if there is no answer to the East-West divide, where are we going to be in 10 years?
>> I happen to not be that pessimistic about the US-China relations. First of all, I don't believe that it will get to a kinetic war. Kinetic war, a physical bang bang, you're dead. Of course, today's war is not just with guns and gunpowder, right? It is very much, uh, cyber, it is space, it is, uh, currency, right? Of course, trade, many other things. So, from that perspective, short of just shooting at each other, the war is already ongoing. Anybody who doesn't know that the war has been ongoing for the last many years is frankly a very, very naive individual. So, you know, we are already in in the thick of it. Uh.
>> But can we be competitors without conflict?
>> Yes, we can. But not if one party wants to make the other side beat the other side down. I, I'll give you some numbers.
>> Sure.
>> When, when Japan became 15, 20% of the economy of the United States, America began to be worried. And so when it got to 30%, that was 1985 in Plaza Accord, right? Jim Baker pushed the, uh, the US dollar down and inflated the U, uh, the Japanese yen. The economy took another 10 years for it to begin to, to, to wane in Japan. By 1995, 10 years after Plaza Accord, it was at 91, 71% of the United States GDP, but that's because of a currency double, right? So if you take away the currency issue, then it is only 35. What is it today? 21.
>> So Jim Baker succeeded in 1985. Now let me give you the number of China's economy as a percentage of the US economy in the years 1980, right after the economic opening, and then 2000, 2010, 2020. Okay, I'll give you those numbers. They are 6 point some, 6 point some, 12. 2000, they were at 12%. They joined WTO. 10 years later, 2010, it was 40%. 2020, it was 71%. And then 2021, it was 76%. And last year, it was still at 76%. You think America will not try to beat you down? Read American history.
>> Well, sure. I remember in the 80s when the US auto industry came to Reagan and they said, "You need to slap tariffs on the Japanese imports, uh, because they're killing us." And Reagan turned around and said, "Build a better car."
>> Right.
>> Right.
>> I wish Reagan is still around to say that. Now, then there's another set of events. 1992, 1993, that's a white paper on East Pacific Asia Pacific in the United States that says that China was America's number one enemy. That's 30 years ago. 1993. 1993, the same year, there was the Yinhe incident. You remember the boat, the ship Yinhe in the Indian Ocean, right? And then 1996, it was the Taiwan, uh, situation, Taiwan Strait situation where two US aircraft carriers outgunned the entire PLA. You wonder how come the PLA has to develop a blue water navy, right? And there's 14 at that time, 14 aircraft carriers and two outgunned, uh, embassy. 2001, there was the, the, the EP3 spy plane, right? I asked Bob Gates, uh, a couple of months ago. I said, "How come all these things are happening on the coast of, uh, of, of China? What if, uh, it's happening on the coasts of California and, and Oregon, right? What will happen?" Oh, we abide by international law. Okay. Okay. So if somebody else abides by the international law also, but under California coast, what would you do? Now, mind you, all those things are military actions. So 93, 96, 99, 2001, and then you have Pivot to Asia, you have Donald Trump, right? You, and, and, and, and then the, the break point came in 2021, March 18, 19 in Alaska. I won't go into detail because time is up. The young lady is standing there already, so.
>> Nobody wants us to end.
>> So, so, so the, the China has given, given up hope. The Alaska meeting. Let me tell you about this Alaska meeting. Why? The key questions are three. Number one, why Alaska? Number two, why March? End of March. Number three, why two people showed up, Yang and Wang Yi? Right? Why both of them? If you cannot answer those three questions, you have no idea what the heck is going on. The reason it was in Alaska was because the last meeting was in Hawaii. There's no reason why it should be still on American soil.
>> Except that Beijing wanted that meeting. Beijing wanted why March because Beijing urgently wants to have an answer. Why number one and number two? For those of you who know anything about Chinese political protocol, they don't send number one and number two out anytime. Only number one and number three. The only last time I heard was 1997, Hong Kong, the return of Hong Kong, which is a national thing that is so important. So number one and number two came. So why did Yang and Wang Yi both show up in in Alaska? Because they want to know if there's any chance to restore the relationship. And we all know what happened in Alaska. It was horrible.
>> Yeah. It was, it just, they sat across the table from each other and lectured each other.
>> Well, it started by Blinken. And so the Chinese know all thoughts, all hopes are gone. So what do you do if you are a responsible leader? You prepare for the worst. Whatever the worst is, from that day on, every decision I believe that are made by Beijing, I'm just an observer analyst. I have no inside information whatsoever, but from any any source. But even the COVID decisions, I bet you at the back of the leader's mind is what happened in case there's something that happened, um, militarily or otherwise with the United States that is really undesirable. They were thinking for the worst. And so since 2021, 2, 2021, March 18, 19, uh, 28, 29th, I think it was, Le, no, 18, 19, before Biden was in the White House, in less than two months, they urgently wanted that meeting. And I believe that that was the, the straw that broke the camel's back, so to speak. And from that point on, all hopes are gone. And if you are still looking at, oh, uh, uh, Blinken is going to to China, I said, you don't know what the heck is going on in the world today. I'm sorry. Uh, and you journalists always have to worry about what happened yesterday and what happened tomorrow. That's, you know, a professional hazard. So, I understand that. So, I sympathize with you, Stephen.
>> No, don't sympathize with me. I am one of those who stayed here and I am confident in Hong Kong's future, as you are as well.
>> You're smart. You're smart. I have a very extremely confident Hong Kong wife that instills that confidence.
>> That shows how smart you are. It proves how smart you are. Hey, nobody claps for the moderator. Ladies and gentlemen, how about another hand for for Steve?
>> Ladies and gentlemen, a louder applause for Ronnie Chan. That was.
>> Oh, do we have time for questions? On you.
>> All right. I think we everyone wants to hear from there. I'm keeping you from the cocktails, but yes, there's their microphone for him. I'm sorry. I, I, the climax of the conference is really good. I have two children, grew up in Hong Kong, now graduating from US colleges, and if I want to tell them you should come back to Hong Kong, what should I tell them?
>> Well, I had lunch with one of my mentees, which is exactly in the same position as your two sons. And frankly, uh, I told my mentee, I'm her mentor. Okay. Um, I said, um, I really feel very comfortable in, uh, in developing economies. That's where the opportunities are. I was in Egypt. I was in Saudi Arabia. I was in Israel. And so the, the problem, I think, is that it's very easy for young people to aspire to a more comfortable life, a certain style, a certain culture. It's very appealing to young people, and we all had that dream at our age. Uh, if you have children who are now 22, uh, and you know, uh, it's very appealing. But where are the economic opportunities? And in fact, nowadays, it is becoming unsafe to live in many parts of the world. I told you I went around the world twice in the last six weeks, and I saw homeless people in tents all over the place in many cities and anti-Asian sentiment. It is just not safe. I'm, I'm not talking about politics. I'm not talking about, you know, ideology. I'm talking about personal security. And so I, uh, you know, I'm very fortunate that my son, when they were young, I took them to developing economies. Uh, so my son loves India, for example. Uh, and he lived like a local in Beijing, uh, when he graduated from university. So I think that the, the thought, uh, the, the thinking of many people today still want to send their children to the West. I mean, I feel bad for these people. They have no idea what is there.
>> Hey, I did okay in the West.
>> You were born in 1966.
>> Yeah.
>> And came to Asia in 1990.
>> You're an old man now. But what about your sons? Uh, it is just not safe in many parts of the world. So I think that, um, uh, you know, for economic opportunities, I would go to developing economies, including China, but not exclusively.
>> Any other urgent? Okay, we'll give one more. Can we have time? We have time.
>> Okay. Um, so by, uh, listening to, uh, Mr. Chan's talking. So US and China relationship is not a loss in translation. It's more like a loss in hope.
>> Say that again.
>> So, uh, the, uh, US and China relationship is sounds like it's not like a we are.
>> No, just move the microphone away from your mouth. Yeah. Right there.
>> All right.
>> That trick of the trade. Just not too close to the microphone, otherwise it goes like this.
>> All right. Okay. Yeah. Uh, I've been, uh, KTV for too long, so that's why. So the, my question is, uh, US and China relationships sounds like we are not lost in translation, but lost in hope. So basically, we have to prepare for the worst. So what, what the worst situation could be, uh, in the foreseeable future? Because recently we see, you know, the, uh, the military, the naval vessels.
>> Almost collide in in the Taiwan Strait.
>> And this, uh, US, uh, EP, whatever the civilian,
>> Uh, uh, plane was a kind of, uh, so-called harassed by, uh, uh, Chinese PLA jet.
>> First of all, why, why are the spy planes there in the first place?
>> Right. So that are we preparing for the worst of like a military conflict or in the full, full scale like in.
>> Basically, businesses have to prepare for contingencies.
>> If you, um, if you are a, a, a national leader, you always have to plan for the worst, right? Especially when you, I, I stated to you all a series of economic numbers and a series of military events, and then if so, what if you were in Beijing in that position, what would you do? And so you, you have to prepare for the worst, right? And the worst can be anything. But I am hopeful that the Chinese are very, um, rational. Consider the following fact: 10 years ago, it is unimaginable that a junior congressman in the United States can visit Taiwan. Unimaginable. Several months ago, Nancy Pelosi, as Speaker of the House, went there. What did China do? Nothing until she left. She left. You tightened the ring, so to speak, right? Notice that there's no accusation from around the world for what Beijing did. And so people asked me the question, they said, "Is what's happening in Taiwan Strait today hastening the return of Taiwan or delaying it?" I said, "Both." Hastening it in the sense that once there is opportunity for China, for Beijing to do that, giving the cost, the international cost, just like that Nancy Pelosi, nobody criticized them, right? You bet Beijing would take it back next time possible. In the old days, Beijing may still think, well, in the long run, are there positions, are there advantages to us if we wait another 10 years, 20 years, 30 years, right? No more thinking. No, not possible. Next time there's opportunity, they will take it. So in that sense, it's hastening it. But is it delaying it? Possible, because of what America is trying to do. It's trying to stir up trouble in China. And China is so, so far very coolheaded not to fall into that trap. And that is not reacting, not overreacting. But you can also not not react. If you not react, you will invite a lot more, you know, uh, scorpions and and mice and everything else that will come out of the closet. So they have to react, but they have to react in a wise way, like the way they handled the Nancy Pelosi visit. And so, I think that, um, I personally am on balance, when you analyze all the factors that I know of, I came to the conclusion that we should be able to prevent an actual war, but it doesn't mean that economically, and I don't think that China needs to go to war. There are a lot of economic means, a lot of cultural means, social means, there are many other ways to skin a cat. And so I think that, um, uh, China hasn't really used any of those economic means yet, right? So I think that I'm hopeful. And, and there's another aspect, another side of it, and that is I do believe that America is forcing itself to withdraw from the global sea. I just came back from the Middle East. I went there three times in the last six weeks, and both the Egyptian, the Israeli, the Saudi Arabian, the UAE, all tell me that America is no longer a force to contend with in that part of the world. I believe that. I know that. I'm very being very controversial, but I have my rationale. I don't have time to tell you that. That in Europe, America will also sooner or later retreat from it. The Ukraine war delayed that process, but it cannot reverse that process. So I think that, um, uh, America and, and, and I tell Beijing friends, I said, don't think that you, the US is waning. It's a very dangerous assumption to make. Okay, America is not waning. America is one of only two countries that can choose to close the doors and live. And the other country will live miserably, and that's Russia. The country that can live relatively happily is the United States. Nobody has that right. China needs energy. China needs food security, food security, right? Whereas the United States has everything. And the technology, the universities, the the economic system, it, it is still the most strongest in the world. So if you think that the United States is waning just because they are retreating, you are making a mistake. You are making a big mistake. And mind you, America was never founded on internationalism. America was founded in isolationism. Monroe Doctrine of 1823, exceptionalism of the 19th century, uh, Roosevelt Corollary of 1904, not joining the League of Nations, the trade, uh, retreating in the 1920s. America is a country that is rooted in isolationism. So if America, it was only forced out because of World War II. So if America were to retreat back to isolationism to some form or another, what's the, what's so new? Rehistoric.