Insights from Hong Kong

Tensions in Russia: Bulletin on Impact of Sanctions

In Economics, Public Affairs on 25 November 2014 at 8:53 AM

(copyright 2014 WOCH IT & News.Yahoo.Com)

Tensions between Russia and the West have not been relaxed.

Prior to the Ukrainian parliamentary elections, which took place on 27 October, the parties of the conflict were mainly consolidating positions. While the US proved ready to cooperate with Russia only on high security issues, the newly elected EU Foreign Policy Commissioner Federica Mogherini has articulated changing EU approach to the relationship with Russia:

“I think Russia stays a strategic player in the regional and global challenges, [regardless if ] we like it or not, but I don’t think it’s a strategic partner anymore”.

Consequently, despite the absence of escalation in Ukraine in October and certain skeptical voices in the EU, there is no disagreement in the West regarding the fact that sanctions should stay in place until the Minsk protocol is fully implemented.

Meanwhile, the subjects of Western sectoral sanctions have started to file complaints to the relevant European institutions. Sberbank, VTB, VEB, Rosneft, Gazpromneft are among the contested. Arkady Rotenberg has filed a personal complaint to the ECJ, too.

The Russian authorities have been focusing on economic problems. The main news of October 2014 was the plummeting rate of the ruble against US dollar and euro. First time since 1998 one dollar rose to 48 rubles. The drop in the exchange rate of the ruble exceeded 40% since the beginning of 2014, and half of it took place in October. Compounding these challenges, the drop in the price of oil has put additional pressure on the Russian economy.

US-Ruble Exchange Rate (copyright 2014 The Money Converter)

Recent public opinion polls keep showing that the Russians are adjusting to new reality. Citizens believe these measures do not create practical problems for them and their families (79%). The respondents also believe (59%) that the country will only benefit from sanctions through local support of national industries.

The challenges of the current situation give more opportunities for those who have information at their disposal. For more, read summary of the Kreab Gavin Anderson Sanctions Bulletin October 2014 issue (download the report here: Kreab Gavin Anderson Sanctions Bulletin October 2014). We also can provide targeted studies tailored to your industry. To order a customised version send a request by e-mail to

Disease Without Borders: How China is Prepared for Ebola

In China on 24 November 2014 at 10:00 AM

Airport passenger temperature screening in China’s airports introduced a decade ago after SARS.

By Dr Bernhard Schwartländer, World Health Organization Representative in China

As world leaders gather in Beijing this week for the Asia-Pacific Economic Cooperation forum (APEC), one issue that has already featured in the discussions is the Ebola epidemic in West Africa – and this region’s preparedness to deal with an outbreak. In managing the threat of Ebola, there are many lessons to be learned from China.

This is the worst Ebola outbreak the world has ever seen. It is more than just a health crisis. This outbreak has become a complex emergency with significant social, economic, humanitarian, political, and security dimensions.

As of 12 November there have been a total of 14,098 cases of Ebola reported since the outbreak began, with 5,160 reported deaths. However, clinical follow-up of Ebola patients shows that as many as 7 in 10 patients who become infected with Ebola die. Modelling work published in October showed that cases may reach as many as 10,000 a week by year-end.

The threat from Ebola has been recognised at the highest levels. In September, the United Nations Security Council passed a resolution declaring Ebola a threat to international peace and security. The UN established the United Nations Mission for Ebola Emergency Response (UNMEER) – the first time in history that the UN has created a special mission for a public health emergency.

The worst hit countries are in West Africa. The vast majority of cases occurred in Liberia, Sierra Leone and Guinea. Senegal and Nigeria have been able to contain small outbreaks. Both countries were declared Ebola-free in October. A small number of cases have now been reported in Mali. And, showing that no country is immune from this disease, isolated cases have occurred in the United States and Spain. No country has been immune from concern.

With numerous economic, trade, political and cultural links between China and West Africa, there is significant interest in China’s preparedness to respond to a potential Ebola case. There are two key points to make.

First, the best way to stop an Ebola case from arriving in China is to fight the outbreak at its source. In the worst-affected countries of Liberia, Sierra Leone and Guinea, China has made a significant contribution to the global response effort. China has provided around US$120 million worth of support to the response to date, both direct financial assistance as well as deploying medical teams and humanitarian aid. These include 252 health and medical personnel deployed from China now working in West Africa, along with essential supplies and equipment, such as mobile testing laboratories. Speed is essential to managing Ebola, and quick diagnosis close to the case is critical for good management of Ebola-infected patients.

China is to be commended for both the speed and substance with which it has responded to WHO’s call for countries to support the international response to the outbreak in West Africa. This is making a real difference on the ground.

Second, and closer to home, is that China has been working to ensure its own systems are well-prepared to respond quickly and effectively should a case arrive. China has learned a lot since the outbreak of SARS in 2003.

In the last decade, China has invested significant resources to upgrade general screening and detection capacity at 259 points of entry, such as airports.  This long-term capacity building stands China in good stead now. In August, China strengthened these systems in line with WHO’s declaration of the Ebola outbreak as an international public health emergency.

For example, there are in place today clear and tested protocols to identify and manage incoming passengers who may have Ebola-like symptoms such as fever, as well as passengers who have been in Ebola-affected countries and had possible exposure to the disease. In Guangzhou, visitors from Ebola-stricken countries to the Canton Fair were given pre-paid mobile phones with phone numbers of health facilities saved for use if necessary.

Border screening alone will not prevent an Ebola case from arriving. The disease has an incubation period of 21 days. It is possible that, even with the most sophisticated entry screening systems available, a case could come into the country without detection at the airport. That’s where a well-prepared health network and good information to the public is crucial.

Overall, China has a strong public health system. And the country has been working hard to ensure it is well prepared should an Ebola case arrive. For instance, special infection control guidelines have been developed and communicated, with specialist staff training.

A series of hospitals have been designated to treat Ebola cases or suspected cases. These have specially designed, state-of-the-art infection control systems in place. Medical and general staff have been given special training, including in the correct use of Personal Protective Equipment. Specially equipped ambulances are on standby to transfer any suspected or actual cases to the designated hospitals. I personally inspected the systems in place at Ditan Hospital in Beijing, one of the designated Ebola hospitals, and was impressed with what I saw.

The possibility of an Ebola case arriving in China cannot be excluded. While there is an outbreak in West Africa, there is a chance of Ebola arriving in China. However, given the systems in place in China to detect early, and respond quickly, should a case appear here the risk of an isolated case progressing to widespread outbreak is currently low.

Of course China, and every other country, must remain vigilant. Further learning from global experience will ensure all countries continuously improve, identify possible gaps in the response, and respond quickly with timely solutions.

Diseases like Ebola do not respect international borders. So China is helping at the source of today’s outbreak in West Africa, ensuring its borders are well-protected and preparing its health system to manage any possible cases.


China versus America: Money Talks, Others Walk

In America, China, Economics on 24 November 2014 at 9:17 AM

Barack Obama and Xi Jinping wrapped up meetings with world leaders in Beijing (APEC) and Australia (G20). Both announced funds for reconstruction, loans, development and humanitarian aid to nations across the region. In on calculation by Australian National University, China pledged a total of US$70 billion in a two-week period. The largest sum was US$40 billion in loans for the development of a Maritime Silk Road across Asia-Pacific to better connect with Europe. This means the construction of massive ports able to handle the largest ships as they travel the historic trade routs from the Far East to the developed West.

In comparison to Xi Jinping, Barrack Obama looked miserly.

“The figures were particularly stark when stacked against American promises. The White House pledged $150 million for Myanmar during Mr. Obama’s recent visit for an Asian summit. On the edges of the same meeting, China pledged $7.8 billion to refurbish decrepit roads and increase energy production.” (Source: The New York Times)

While Mom always said money doesn’t buy friends, Mom wasn’t a politician. Having deep pockets when neighbouring countries are in need buys a lot of influence. And China has cash. The USA holds foreign reserves of US$136 billion. China golds US$4 trillion. (Source: Wikipedia) That means China has cash reserves 29 times larger than the USA.

And while the economy of China may be slowing, it remains healthy as it moves from a core of manufacturing up the skills index into a higher service-based economy. It has plenty of growth ahead. Thankfully the USA economy is continuing to improve. However the long road back from the 2007 financial crisis has left the coffers drained. The US government needs its cash for the domestic economy.

China has plenty for home and abroad.

Remember those rainy days as children when you were on top of the world as the richest man in the game of Monopoly? Didn’t it feel great to count (and recount) your growing pile of $500 bills? You were China today.

Xi Jinping is winning at Monopoly

Then there were the days you couldn’t catch a break. Inheritance tax? Utility payments? Rent then mortgages…jail felt like a relief! It’s always foolish to underestimate the political power of the USA, however its ability to spread the cash is limited after a large number of bills.

In Asia-Pacific, China is the banker and the emerging country’s best, new friend (sorry Mom).



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