THE SHOWDOWN
CK Hutchison announced the deal on Mar 4. Less than 10 days later, Beijing-controlled newspaper, Ta Kung Pao, which is based in Hong Kong, published two sharply worded commentaries, urging the Li family to “stop being naïve and confused”. They criticised CK Hutchison of being unpatriotic and “selling out all Chinese people.”
This marks the first time Beijing has publicly singled out Hong Kong’s most prominent conglomerate for sharp criticism in the 27 years since the city’s return to Chinese sovereignty, causing jitters and concerns about the politicisation of business in the local and broader business community.
Beijing’s apparent loss of composure stems from not being informed of the deal in advance, amid US media reports that BlackRock chairman and CEO Larry Fink called US President Donald Trump to secure his blessing. Mr Trump hailed the deal as part of his administration’s efforts to reclaim the Panama Canal.
Despite finding themselves in a political storm, the Li family has surprisingly kept its cool. In fact, the Mar 4 announcement, which stated that the sale was purely commercial in nature and unrelated to geopolitics concerning the Panama ports, remains CK Hutchison’s only public statement to date.
Incensed by the silent treatment, Ta Kung Pao and another pro-Beijing Hong Kong newspaper Wen Wei Po have published at least 20 news stories and commentaries urging the Li family to respond to “public concerns” and halt the deal in the name of national interests and security.
The wrangling reached a climax on Mar 26 when Bloomberg cited sources reporting that CK Hutchison was believed to be moving forward with the deal as scheduled, despite Beijing’s anger over the transaction.
In response, the Hong Kong and Macao Affairs Office again signalled its displeasure by reposting two articles published by Ta Kung Pao on Mar 26 and 27, criticising CK Hutchison for capitulating to US pressure and sacrificing national interests.
The following day, CK Hutchison finally relented amid reports that the State Administration for Market Regulation in Beijing would investigate the deal “to ensure fair competition” and “safeguard the public interest.”
Until then, Beijing had hoped that intense media pressure would suffice to persuade the Li family to pause the deal, mindful of the potential impact on business confidence in Hong Kong and China if it intervened directly.
