Asia’s richest man Li Ka-Shing has revealed his inner hopes and fears in a dramatic press interview

Li’s political pipe dream
Eddie Luk
Friday, November 29, 2013

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Asia’s richest man has revealed his inner hopes and fears in a dramatic press interview. And Li Ka-shing, chairman of Cheung Kong and Hutchison Whampoa, said if he could turn back the clock and start again, he’d be a politician. However, Li warned that Hong Kong should not be ruled by an individual, and the government should never exercise its powers selectively. In a wide-ranging interview with the Guangzhou-based Southern Metropolis Daily, Li spoke about his sons, the HK$2 billion he paid a kidnapper, politics, government, the market situation and his commitment to Hong Kong. Present at the interview was the director of the Li Ka Shing Foundation, Solina Chau Hoi-shuen.The daily, renowned for its critical and investigative reporting, devoted six pages to the interview, which contained more than 20,000 words.

Li, aged 85, said government power should be grounded in law so that policies are implemented fairly and justly.

He said nobody can accomplish everything alone.

“However hardworking I am, I find that nobody can resolve all problems,’ Li said.

“Sometimes I feel fortunate that I was never a government official as this requires one to balance and resolve problems to satisfy different interests, and the ways for resolving problems can end up becoming bigger problems.’

Asked if his investment decisions have been affected amid speculation that he has not been on good terms with the SAR government led by Chief Executive Leung Chun-ying, Li said: ”

In a healthy society, the government and business enterprises are closely related. The most important thing is that the government’s power should be based on the rule of law so that all policies will be implemented fairly and justly. Hong Kong should not be ruled by individuals. Power should never be exercised selectively or used in a way that will affect the people’s confidence in the government’s fairness.’

Li said when policies become unfair, the business environment worsens, and when a government chooses to exercise powers selectively, investment incentive is bound to drop.

Li said that in a free and open market, principles and the rule of law are essential. “Hong Kong has many competitive core values, including a free and open market, emphasis on the rule of law and principles,’ Li said.

“If governance becomes improper, these values would all be gone overnight,’ he said.

Commenting on whether Hong Kong should become a welfare state, Li said the key is to give people a choice that will enable them to move up the social ladder.

“If the government comes up with the wrong policies that cannot solve the problem of social mobility and only acts against the capable ones, it is wrong. It is because Hong Kong people are innovative. The government’s role is to give everyone a chance to create wealth rather than wait to be helped,’ he said.

Li said a free-lunch approach will not reduce the gap between the rich and the poor.

“The only solution lies in providing a good education for the young generation,’ he said.

Asked how he has handled political pressure in operating his business, Li said: “I am not a clever person. I am not almighty. I can’t predict changes in politics nor can I influence politics.

“What I can do is use what intelligence I have to make decisions which are favorable to our shareholders.’

Quit Hong Kong? What a joke!
Karen Chiu
Friday, November 29, 2013
Li Ka-shing quashed speculation he and his conglomerates may exit Hong Kong, stressing their local assets and investments far exceed those overseas.

He also said plans remain alive to float Hutchison Whampoa’s retail operation.

“Speculation over any withdrawal is ridiculous and a big joke,” Li told the mainland paper.

He said his firms booked HK$430 billion in revenue across the globe in 2012 and overseas investment amounted to just HK$13 billion or 2 percent of total income.

Also, around HK$4 billion has been invested in local container projects. “It is normal to buy low and sell high and I have never received any criticism across the world over possible withdrawals through any [asset] sale,” Li said. “It’s really sad to hear such talk in Hong Kong.

“Cheung Kong (0001) and Hutchison Whampoa (0013) will never leave Hong Kong while their size is another issue. I will put 100 percent into protecting shareholders’ interests. Even future sales have nothing to do with exiting Hong Kong.

“Those who make such comments about me or about my firms leaving Hong Kong are being provocative and they hurt the business sector.” Li added the sale of ParknShop was halted this year as none of the offer prices were appropriate.

He stressed some of the properties, such as Cheung Kong Center, Aon China Building, and Hutchison House where he has offices, will never be sold.

Meanwhile, the Wall Street Journal reported that Hutchison Whampoa is preparing an initial public offering of its retail arm, AS Watson, in the first half of next year. It said a dual Hong Kong and London listing is the most likely. While no details of the fundraising amount have been divulged, analysts have suggested up to US$10 billion could be raised.

Commenting on critics, who claim Li holds a hegemony over the local property sector, the tycoon one again labeled such talk as a joke.

“Everybody knows that the Hong Kong property market has always been driven by government policies – including land supply, design, stamp duties – and not by developers.”

He said land prices in Hong Kong are high, and already show signs of an unhealthy situation.

“Our property sales in Hong Kong are the worst in 13 years.”

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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