China's top political body met in secret and issued an ominous message to Hong Kong - CNN

It also came with a stark message for Hong Kong.

The four-day plenum, which ended Thursday, came at a time of huge pressure on Chinese President X Jinping's government, including an ongoing trade war with the United States, a slowing domestic economy and violent protests in the former British colony.

The official communique only contained broad references to "increasing challenges at home and abroad." No definite plans or new policies were presented by the lengthy document.

One thing that was made clear though was that Xi is still firmly in charge, despite the recent troubles.

"The plenary session calls for the entire party and peoples of all nationalities to unite more closely around the Party Central Committee with comrade Xi Jinping as the core," the statement said.

The Communist Party Central Committee's almost 400 members meet semi-annually to formulate new policy and approve personnel changes at the top level of government. The committee met for its fourth plenum in Beijing this week.

Among praise for the government and Communist Party buzzwords, there was an ominous message from the Chinese government for Hong Kong protesters, now in their 21st week of demonstrations.

"We must establish and improve the legal system and enforcement mechanism for safeguarding national security in (Hong Kong and Macao)," the official statement read.

Safeguarding national security

Hong Kong has now been a thorn in the Chinese government's side for more than four months.

Mass protests which began over a controversial China extradition law have grown into more violent demonstrations over fears around Beijing's tightening grip on the important financial hub.

Until now, the Chinese government has been relatively restrained on the protests, stating their support for the Hong Kong government and their faith in local authorities to resolve the crisis.

But there have been hints of tougher action by Beijing if the demonstrations grew out of control or if they crossed any of the Communist Party's "bottom lines."

"Don't ever misjudge the situation and mistake our restraint for weakness," Yang Guang, spokesman for mainland China's Hong Kong and Macao Affairs Office, said in August.

It is almost certain that the situation in Hong Kong was widely discussed behind closed doors in Beijing during the fourth plenum this week but very little of that appears in the final communique.

"Hong Kong and Macao must be governed in strict accordance with the Constitution and the Basic Law, and the long-term prosperity and stability of Hong Kong and Macao should be safeguarded," the statement said.

It then stated the need to "improve" the legal system and enforcement mechanism in Hong Kong and Macao.

That is likely to be a euphemism for enacting Hong Kong's hugely controversial Article 23 national security law, according to Willy Lam, an adjunct professor at the Chinese University of Hong Kong and longtime analyst of Chinese politics.

"Of course we don't have hard and fast evidence but I think a logical conclusion would be the introduction of Article 23," Lam said, adding that Chinese officials had been pushing for it behind closed doors for some time.

Part of the Basic Law, Hong Kong's de facto constitution, Article 23 calls on the local government to "enact laws on its own to prohibit any act of treason, secession, sedition, subversion against the Central People's Government."

But attempts to bring it into force in 2003 led to massive protests and it hasn't been touched since.

"It would be very divisive, especially after what happened in the past four or five months," Lam said. "If Beijing were to introduce Article 23, then the stormy weather will be back. It will exacerbate conditions."

Xi triumphant

The Communist Party's plenum meetings are one of the country's main forums for major changes of party policy and have previously changed the course of Chinese history.

In 1978, it was during a plenum that then-Paramount Leader Deng Xiaoping began the policy of economic opening which would turn China into an economic powerhouse.

It was at the second plenum in January 2018 that the Communist Party agreed to remove term limits on the office of the Chinese presidency, effectively allowing Xi to remain president for life.

In the lead-up to this week's plenum, there were rumors of possible personnel changes at the top levels of the Chinese government which could begin to outline a successor to Xi.

The Party Secretary of industrial city Chongqing, Chen Min'er, was reported to be in the running for a seat on the Communist Party's Standing Committee. It would have been a huge promotion and a clear sign of big things to come.

It followed whispers of dissatisfaction with Xi and his tight grip on power. Since the trade war with the US began in mid-2018, it had been rumored that opposition to the Chinese president was growing behind closed doors. So far, Xi has even refused to nominate any potential successor, a break from modern Communist Party tradition and a sign that he retains a significant hold on power.

In the end, there were no major changes, and no personnel announcements other than the automatic promotion of two new alternate members to the Central Committee.

Instead the president and his signature Xi Jinping Thought are mentioned prominently in the communique, from domestic and international policy to military advancement.

"We must firmly establish the guiding position of Xi Jinping's strong military thinking in national defense and army building," the statement says.

If the communique is an accurate representation of what happened behind closed doors, Xi Jinping is here to stay.

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2019-11-01 07:32:04Z
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Hong Kong just entered a recession. Experts say economy will 'remain weak' amid protests, trade war - CNBC

Hong Kong protesters donned Halloween masks in Lan Kwai Fong on Thursday evening, defying an emergency law that bans face coverings.

Anthony Wallace | AFP | Getty Images

Hong Kong's economy will likely "remain weak" for the rest of this year, economists and trade experts told CNBC on Friday.

"They're getting hit on two fronts. The protests are impacting retail sales. It is impacting tourism. Added to that, of course, you've got the U.S.-China trade war, which is impacting exports. So, we're expecting that it is unlikely that we're going to see a positive growth in Q4. We're going to see further contraction," said Sian Fenner, lead Asia economist at Oxford Economics.

The Asian financial hub slid into a recession for the first time in a decade in the third quarter, according to government data published Thursday. The city's statistics agency said domestic consumption weakened amid ongoing anti-government protests. It also cited the protracted U.S.-China trade war as another factor, as Hong Kong reported "an enlarged decline" in exports.

Billy Wong, deputy director of research at the Hong Kong Trade Development Council said that Hong Kong's negative growth did not exactly come as a surprise.

"The number is not that happy, but I wouldn't say it's really a surprise. I think it was really expected for Hong Kong to facing economic downturn," said Wong.

He agreed that the trade war and protests are the main factors contributing to the contraction in Hong Kong's economy. Wong noted, however, that while exports have slowed since last November, the city's GDP didn't contract until the third quarter of this year. When asked, he agreed that weak consumption and a slowing economy could lead to layoffs in sectors like dining and retail.

But one industry has seen some positive growth, Wong said. As people avoid the streets, supermarkets benefit as people buy more home necessities, he said.

Hong Kong may report negative growth this year as the economy reels from more than four months of social unrest, Financial Secretary Paul Chan wrote in a blog post.

Paul Yeung | Bloomberg | Getty Images

Weak consumer spending

Local businesses told CNBC they are certainly feeling the financial impact of domestic unrest. Even shops in the normally bustling Wan Chai district are getting hit.

Kitty Chan, who works at her parent's flower shop, said she's noticed that far fewer people are buying bouquets for functions. She estimated that profits have dropped 50% for the shop, which she said had been in the district for 15 years.

"If the protest continue, I think it really drops ... They will be coming to buy the flower in the morning, in the morning time, afternoon time, after 7 o'clock they're all gone," she said.

Andy Ho, who works at a pharmacy in Wan Chai, gave similarly grim figures: "Our store has been here for 50 years. Our business has really declined in recent months — close to 40%."

He said as long as the social unrest remains unresolved, the economy "will remain weak."

"For our store, 70% of our customers are local and 30% are tourists. Among the 30% tourists, 80% of them have disappeared. As for locals, in the recent months, people are really less willing to spend ... the economy in the next few months will still be weak," said Ho.

Hong Kong — a former British colony returned to Chinese rule in 1997 — has been crippled by widespread demonstrations since early June. Reuters reported on Thursday, local police used tear gas to disperse hundreds of protesters, many dressed in black and wearing now-banned face masks, mixed in with people dressed up for Halloween in the city.

Oxford Economics' Fenner said the biggest uncertainty for the city right now is when the protests will end, and "until that stops" key domestic drivers like retail and tourism will struggle to grow.

China-US trade war

In a Friday note, Bank of America Merill Lynch wrote that Hong Kong may be facing a "prolonged recession" and lowered its full-year GDP forecast to a 2.1% year-over-year decline. Its previous 2019 GDP forecast projected a more muted decline of 0.1%.

"Hong Kong is particularly vulnerable to external demand weakness, given its reliance on tourism and dependence on the Chinese economy. Many sectors (tourism, retail, hotel, catering and transportation) have already taken a blow from the months of disruptions to business. Not to mention that high level of uncertainty also significantly impaired business confidence and suppressed investment demand," the bank wrote.

The U.S. and China were set to meet in Chile to sign "phase one" of the trade deal. But President Donald Trump announced that the trip was cancelled on Thursday due to protests in the South American nation, adding that "the new location will be announced soon" for the two leaders' signing.

While Oxford Economics' Fenner said "phase one" will likely "go ahead," this does not mean the trade war is done. She said that there will most likely be more "flip flopping" moving ahead but probably no more escalations in terms of tariffs.

"But the damage has already been done. We've got tariffs now, that 18 months ago on average about 3%. They're now over 20%. And we're not looking for those tariffs being removed anytime soon," said Fenner.

With no end in sight for either the protests or trade tensions between China and the U.S., HKTDC's Wong said, "for the rest of this year, things will remain weak."

But Wong is hopeful that maybe as China and the U.S. both see a slowdown in their economies, they will be more inclined to strike a deal, and thus relieving some trade pressure for Hong Kong.

— CNBC's Vivian Kam contributed to this report.

Correction: This story has been updated to reflect that the flower shop in Wan Chai has been open for 15 years. A previous version misstated how long it had been operating.

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2019-11-01 06:06:02Z
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'Satisfaction': N Korea confirms tested multiple rocket launcher - Al Jazeera English

North Korea confirmed on Friday it conducted a third test of a new "super-large" multiple rocket launcher that it says expands its ability to destroy enemy targets in surprise attacks, as nuclear talks with the United States remain in limbo. 

The official Korean Central News Agency (KCNA) described the tests a day after South Korea and Japan said they detected two projectiles launched from an area near Pyongyang, the North Korean capital.

North Korea has been moving to enhance its military capabilities.

The latest test of the rocket launcher follows two tests in August and September of the same weapon. 

More:

Kim Jong Un "expressed satisfaction" at the success of the tests and congratulated the scientists who had developed the weapon, KCNA said, suggesting that Kim was not at the site.

North Korea's state newspaper, Rodong Sinmun, published a photo of the multiple rocket launcher, surrounded by yellow flames and smoke.

Thursday's test verified that the "continuous fire system" of the multiple rocket launchers was able to "totally destroy" a group target of the enemy with a surprise strike, KCNA added.

Military officials in Japan and South Korea said on Thursday afternoon that the North had tested a projectile that travelled more than 322 kilometres (200 miles) across the country before landing in waters between the Korean Peninsula and Japan.

Japan's Chief Cabinet Secretary Yoshihide Suga said Japan had lodged a protest over the test, which he described as a missile launch and said was "extremely regrettable".

'Escalatory behaviour'

“North Korea is engaged in increasingly escalatory behaviour," US Senator Cory Gardner, a Republican and chairman of the Senate Foreign Relations Subcommittee on East Asia, the Pacific and International Cybersecurity Policy said in a statement.

"This launch and continued North Korean aggression underscore the need for the Trump Administration to recommit to the maximum pressure policy" and for Congress to impose additional sanctions against the Kim government, Gardner said.

However, South Korea's national security adviser Chung Eui-yong said the North's missile launches did not pose "very grave threats".

"We're also test-firing missiles, no less than North Korea does," he told a parliamentary session. "Our missile defence and intercept capabilities are absolutely superior to theirs."

The weapons test is the first since working-level talks on October 5 between the US and North Korea ended without agreement.

North Korea has repeatedly emphasised an end-of-the-year deadline for denuclearisation talks with Washington that Kim set earlier this year.

Although Kim and US President Donald Trump have a "special" relationship, "Washington political circles and DPRK policymakers of the US administration are hostile to the DPRK for no reason," a North Korean statement on KCNA said last month.

The Democratic People's Republic of Korea is the official name for North Korea.

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2019-11-01 03:46:00Z
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'My heart is broken': Fire nearly destroys historic Japanese castle built 500 years ago - USA TODAY

Mari Yamaguchi, Associated Press

Published 8:49 AM EDT Oct 31, 2019

TOKYO — A fire broke out early Thursday and spread quickly through historic Shuri Castle on Japan's southern island of Okinawa, nearly destroying the UNESCO World Heritage site.

Firefighters battled the blaze for about 12 hours before bringing it under control in the afternoon.

The fire in Naha, the prefectural capital of Okinawa, started from the castle's main structure and quickly jumped to other buildings. Three large halls and four other structures burned down, a fire official said.

No one was injured. The cause was not immediately known.

An annual weeklong castle festival that began Sunday was to run for a week but the remaining events were canceled.

Video on NHK public television showed parts of the castle engulfed in orange flames, then turning into a charred skeleton and collapsing to the ground. Many residents watched from a hillside road and quietly took photos to capture what was left of the castle before it was largely lost. Some people were crying.

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"I feel as if we have lost our symbol," said Naha Mayor Mikiko Shiroma, who led an emergency response team. "I'm shocked."

Okinawa Gov. Denny Tamaki cut short a trip to South Korea to return to Naha. "My heart is broken," he said. "But I also feel strongly that we must reconstruct Shuri Castle, a symbol of the Ryukyu Kingdom filled with our history and culture."

The castle is a symbol of Okinawa's cultural heritage from the time of the Ryukyu Kingdom that spanned about 450 years from 1429 until 1879, when the island was annexed by Japan.

It is also a symbol of Okinawa's struggle and efforts to recover from World War II. The castle, built 500 years ago, first burned down in 1945 during the Battle of Okinawa near the war's end, in which about 200,000 lives were lost on the island, many of them civilians.

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The castle was largely restored in 1992 as a national park and was designated a UNESCO World Heritage site in 2000 as part of a group of ancient ruins, castles and sacred sites that "provide mute testimony to the rare survival of an ancient form of religion into the modern age."

Chief Cabinet Secretary Yoshihide Suga told reporters that the central government will do its utmost to reconstruct the castle.

The government dispatched officials from the Agency for Cultural Affairs and other government organizations to join efforts to investigate the cause of the fire and study ways to protect other historical sites from disasters, Suga said.

Kurayoshi Takara, a historian at the University of the Ryukyus who helped reconstruct Shuri Castle, said he was speechless when he saw the fire. He told NHK that the castle reconstruction was a symbolic event for Okinawans to restore their history and Ryukyu heritage lost during the war.

"I still can't accept this as a reality," Takara said. "It has taken more than 30 years and it was a monument to the wisdom and efforts of many people. Shuri Castle is not just about the buildings, but it reconstructed all the details, even including equipment inside."

UNESCO Director General Audrey Azouley expressed her sympathy. "Deep emotion and sincere solidarity with the Japanese people as we see the tragic fire at the beautiful #shuricastle," she wrote on her Twitter account. "This is a loss for all humanity."

Okinawa was under U.S. occupation until 1972, two decades after the rest of Japan regained full independence.

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2019-10-31 11:57:00Z
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North Korea fires two missiles after warning it is losing patience with the U.S. - The Washington Post

Heo Ran Reuters People in Seoul watch a TV broadcast on Oct. 31, 2019, showing file footage for a news report on North Korea firing missiles into the sea between the Korean Peninsula and Japan.

TOKYO — North Korea launched two missiles Thursday, marking its 12th test since May, in an apparent effort to pressure the United States to return to denuclearization talks with a better offer.

The missile test comes four days after North Korea warned it was losing patience with the United States and its “hostile policy” and restated its end-of-year deadline for Washington to change its approach. 

The “short-range projectiles” were launched from the province immediately north of the capital, Pyongyang, South Korea’s Joint Chiefs of Staff said in a statement, reaching an altitude of 55 miles and flying about 230 miles into the sea off the east coast.

“This type of act from North Korea does not help efforts to alleviate tensions on the Korean Peninsula, and we urge North Korea to stop immediately,” they said. South Korea’s National Security Council expressed its “strong concern.”

Japanese Prime Minister Shinzo Abe said the test involved ballistic missiles, and strongly condemned it as a threat to the peace and security of his country and region.

[Kim Jong Un rides white horse on sacred mountain — and plans ‘great operation’]

North Korea’s top negotiator said nuclear talks with the U.S. broke down because the Washington delegation would not ‘give up their old viewpoint and attitude.’

The missiles were fired a day after North Korean leader Kim Jong Un sent a condolence letter to his South Korean counterpart, Moon Jae-in, over the death of his mother. 

Kim expressed his “deep condolences” and offered a “consoling message to President Moon” in the letter delivered via the border village of Panmunjom late Wednesday, South Korea said Thursday. 

But the missile tests only underlined how badly relations have deteriorated this year between North and South Korea, and with the United States. 

Talks between North Korean and U.S. officials broke down in Stockholm earlier this month. After an eight-month stalemate, the United States had hoped to breathe new life into the negotiations, but North Korea walked away, calling the discussions “sickening.” 

Then, two weeks ago, Kim was shown riding a white horse in the snow on the sacred Mount Paektu, with state media saying he was planning a “great operation.” 

Last week, Kim ordered the removal of South Korean facilities at a shuttered joint tourist project, and he has since rebuffed Seoul’s attempt to hold talks on the issue.

On Sunday, Pyongyang repeated its frustration with what it calls a “crafty and vicious” attempt by the United States to isolate and stifle the country through sanctions. The statement said the United States is seriously mistaken if it thinks it can keep the situation quiet through the end of the year by exploiting the “close personal relations” between President Trump and Kim.

More fiery rhetoric emerged from state media on Tuesday, this time attributed to leading official Choe Ryong Hae at an earlier speech to a summit of the Nonaligned Movement in Azerbaijan.

“Now the situation on the Korean Peninsula is at a critical crossroads of either moving toward a durable peace along with the trend of detente or facing again a touch-and-go crisis,” Choe said.

The missile test may have been partly aimed at underlining the point.

“It is consistent with hardening signals from state media since the breakdown of the Stockholm talks and Kim’s climb up Mount Paektu,” said Rachel Minyoung Lee, a senior analyst at NK News, a Seoul-based website specializing in North Korea news and analysis. 

Some experts believe that the fire and fury coming from Pyongyang is an attempt to drive a hard bargain with Trump, in the hope he offers North Korea a favorable deal in return for not disrupting his reelection campaign with more serious long-range missile tests.

Min Joo Kim in Seoul contributed to this report.

Read more

Kim Jong Un says it’s ‘shabby.’ This N. Korean mountain resort’s days may be numbered.

Kim Jong Un rides white horse on sacred mountain — and plans ‘great operation’

Fast, low and hard to stop: North Korea’s missile tests crank up the threat level

Today’s coverage from Post correspondents around the world

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2019-10-31 11:13:00Z
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Hong Kong's first recession in a decade could be even worse than feared - CNN

Hong Kong plunged into recession in the third quarter, according to official data released Thursday. The economy shrank 3.2% during the three months to September, compared to the previous quarter. That's a sharp slowdown from the 0.5% contraction recorded in the second quarter, and much worse than economists had expected.

With no immediate resolution to the city's political crisis on the cards, Hong Kong's first recession in a decade could extend into the new year. Compared to the previous year, the economy shrank 2.9% in the third quarter.

"Frankly, there is no room for optimism," embattled Hong Kong Chief Executive Carrie Lam said at a business event on Thursday, ahead of the preliminary growth figures. Hong Kong will release revised GDP figures next month.

As a major trading hub, Hong Kong was already hurting from the US-China trade war and China's slowing growth. Five months of mass demonstrations is now pushing the city toward an economic crisis.

A government spokesperson said Thursday that Hong Kong's economic growth had been on an upward trend since last year amid a slowing global economy and US-China trade tensions, but "the situation showed an abrupt deterioration recently due to the severe impacts of the local social incidents."

"Much of the pressure is now coming from the political unrest. The trade war itself would cause Hong Kong's GDP growth to slow but not a contraction, while the political unrest could," said Tommy Wu, a Hong Kong-based economist with Oxford Economics.

Economists are now predicting that for the whole year, Hong Kong will miss its earlier target of between 0% and 1% growth, and the pain could continue into next year.

Hong Kong's GDP "is quite likely to fall into negative growth in 2019 and also 2020 [...] I can't see how the protests could end," said Iris Pang, economist for Greater China at ING.

Wu expects Hong Kong's economy to contract 0.1% in 2019 and "only to grow at a meager 0.6% in 2020."

"The downside risk to the forecast is significant. If the political unrest prolongs beyond this year, I would expect next year's GDP to contract as well," he said.

Mass demonstrations have decimated the city's tourism industry. Visitor numbers plunged 37% year on year for the third quarter.

Hotels are on average only two-thirds full, a drop of 28% compared to the same period a year earlier. InterContinental Hotels Group said in an earnings report earlier this month that revenue per room in Greater China fell 36% last quarter, citing "ongoing unrest in Hong Kong." The company operates several luxury hotels located in areas frequently targeted by protesters.

Retail figures are also taking a beating as several shops have been forced to close early or shut down for a full day several times over the last few months.

Some protesters have targeted shops, restaurants and banks viewed as unsympathetic to their cause, smashing in windows, vandalizing storefronts with graffiti and even setting fire to some properties.

Last week, the city's Financial Secretary Paul Chan announced a new round of economic measures to support businesses affected by the ongoing unrest, including slashing rents in half at properties leased by the Hong Kong government, providing fuel subsidies for taxi drivers and fee subsidies for local ferries. Those plans follow on earlier initiatives, including the allocation of 2 billion Hong Kong dollars ($255 million) to support small companies and a 19 billion Hong Kong dollar ($2.4 billion) stimulus package to help safeguard jobs and provide relief to "people's financial burden."

Despite the troubled Hong Kong economy, the city's financial markets are largely holding up. The Hang Seng Index (HSI) is still up 4% for the year, and the political crisis hasn't been a deal breaker for investors yet, many of whom still see the city as an important gateway to Asia.

The IPO market is also proving resilient: In September Anheuser-Busch InBev (BUD) listed its Asia business on the Hong Kong Stock Exchange (HKXCF) raising $5 billion in the second biggest IPO of the year after Uber (UBER).

That deal pushed the amount of funding raised on the Hong Kong exchange to the third highest in the world this year after the New York Stock Exchange and the Nasdaq, according to Deloitte.

Michelle Toh contributed to this report.

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2019-10-31 11:10:00Z
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70 dead after gas cylinder explosion sparks fire on Pakistan train - CNN

The train was passing through the Punjab city of Rahim Yar Khan on Thursday morning when the cylinder exploded, causing a fire which spread through the train, according to local police officer Amir Taimoor.

Seventy people are dead and another 30 are injured, said Nadeem Zia, the medical supervisor of District Headquarters Hospital in Liaquatpur, a city in Rahim Yar Khan district.

Earlier, Taimoor said that around a dozen people are critically injured. Army troops, paramedics, and an army aviation helicopter are currently on site.

Although gas cylinders are banned on trains, passengers were using gas-powered cookers to prepare breakfast inside the train carriage when the explosion occurred, Taimoor added.

He added that many of the people on board the train were heading to a protest in the Pakistani capital of Islamabad, about 800 kilometers (500 miles) from Rahim Yar Khan.

The train was running on the Tezgam line, a daily service that goes from the coastal city of Karachi to the northern city of Rawalpindi.

CNN's Sophia Saifi contributed to this report from Islamabad.

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2019-10-31 10:06:00Z
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