if hong kong. [inaudible] hong kong will benefit and they will also help other to benefit. >> if you look at hong kong now, some of the major issues including, for instance, the aging society, the rising housing crisis, the gap between the old, the poor and the rich, these challenges cannot resolve on its own. something has to be done to solve these problems, not just from the hong kong local government but from beijing as well. how can they help in terms of these very local, very residential problem. >> if we use the housing problem in hong kong, the price is skyrocketing. however, if we look at hong kong itself, the amazing part is that not only a new territory, but in other parts of hong kong there are still lots of undeveloped land. now traditionally under the british world, and i think under the first 20 years of hong kong returning back to mainland china, the traditional paradigm is to keep the property development in the very measured and controlled way so that property price will go up. thi

in hong kong. i am haidi lun. rishaad: i am rishaad salamat coming to you from bloomberg's asia headquarters in hong kong. this is "bloomberg markets: asia." ♪ haidi: asia-pacific markets pair monthly gains. central banks adopt a hawkish tone. foraad: the search inflation, picking up a fraction, but a long way on the target, industrial production false in may. haidi: mark carney says investors are ignoring the potential costs of climate change. 20 years after the handover, what does the future hold for hong kong and china? indeed, talking china, breaking news, manufacturing pmi and nonmanufacturing data from a slight move to the upside, 51.7, looking for 51. what is your instant take? >> it is a surprise. i thought sentiment is weaker. you have a cooling off for the real estate market. it means momentum in the economy continues to be robust and that very gradualonly slowdown at worst in the coming few quarters. let me bring up a chart, #7313, the diversions nonofficialcaixin manufacturing. the official number ha

i think independence movement in hong kong. ithinki independence movement in hong kong. i think i should say that that movement has never been a mainstream movement has never been a mainstream movement in the city, and in fact, according to a series of opinion polls, young people especially seem to have less support for the independence movement than they had even a year ago. but certainly this is something the chinese government is something the chinese government is quite worried about. they wouldn't want to see these kinds of sentiment saw movement like this really slow or infect some of its other special or administrative territories, so this is definitely something the chinese government is extremely concerned about, and that was widely seen as the pretext under which two pro—independence lawmakers we re which two pro—independence lawmakers were ousted from their seats last year. and there's also some concern from the americans, urging the chinese to respect civil liberties in hong kong. what has been the reaction from beijing? that's right. this is a statement

kong and see hong kong as an opportunity. there are lots of foreign investors who come and gather at this forum. top of mind when you think about hong kong, how does this special administrative region stay relevant in the face of a fast-growing china where you have cities that have a clips to the growth of hong kong? how does it stay relevant? >> hong kong has been very relevant to the opening up and development of the chinese economy, and we are now even more relevant because there are major initiatives and economic development that have been rolled out by our nation. positionvery unique under one country, two systems, strengths, and advantages, we will not only benefit from this opening up, we will be able to contribute to these major initiatives because we are one of the world's international financial centers. we have years of experience in working with the outside world. , andve the rule of law protection of intellectual property rights them a so i feel the relevance is becoming even more important. will hong kong remain

a landmark day for hong kong. rise ofable to see the the city is not just a civil servant, but a business leader. have you reflect upon the past 20 years and how to the plane to hong kong's future? fred: hong kong, during the last 20 years have -- has grown to become an international financial center. 20 years ago, our financial market was not as good as today. capitale are the -raising center for not just but in the world. our fundraising diversity is one of the top three in the world. alongside with new york and london. we definitely have done well, in terms of economic growth, during the last 20 years. our growth rate is roughly around 3.4% during the last 20 years. compared to china, you would probably say that is low. but compared to most of the economy around 2%, we have done quite well. yvonne: what you see as the biggest challenge? put: we probably have to more resources on i.t. shenzhen is the silicon valley of china. yvonne: singapore, catching up? fred: one big challenge is to remain our status -- retai

juliana liu is in hong kong. obviously a significant moment, but on many levels and the security around this trip tells its own story, doesn't it? absolutely. we are expecting the president to be coming down from his plane any moment now. after he touched down in hong kong the police boats behind me started making several runs around our position. security is at unprecedented levels. news reports there are already 10,000 police officers on duty to ensure his safety. of course that essentially means that local citizens, ordinary citizens, will be very unlikely to get anywhere near to the president and first lady. he is expected to be making an important speech right after he arrives on the tarmac. all eyes and all ears will be on what he says. will he talk about restarting political change in hong kong, will he addressed the youth led independence movement? everyone is very interested to hear what tone he sat for the rest of the trip —— toned —— tone he sets. sat for the rest of the trip —— toned -- to

you think so, what if other hong kong citizens disagree? what if they wanted to call for independence? they disagree in the form of being an expression of personal opinion, then everybody could have a view. you could condemn him and so on. but whether that expressing a view constitutes an offence, then we'll have to look at what the law says. what's the answer? we'll have to look at what the law says. can you promise the people of hong kong that never in your tenure will someone go to jail for calling for autonomy, self—determination or independence? well, i can promise the people of hong kong that we will abide by the rule of law. so that's a no, you can't make the promise? no. how can you promise when you don't know the actual situation, when you don't know the actual legislation in hong kong and to give a, sort of, perpetual situation answer, i don't think that is a very fair question to ask. china's influence in hong kong is growing — some of it open, some of it not. last year there was public outrage over the suspected abductions o

carrie gracie, bbc news, hong kong. we can speak with our correspondent now in hong kong. how widespread is the feeling for more democracy, even independence, and how much is likely to impact on the chinese president? he has addressed the issue of democratic rights on this visit, hasn't he? yes, i would say there is a big difference between voices calling for greater democracy and greater voting rights and those calling for outright independence. these voices tend to be representing different factions within the pro—democracy movement. certainly the chinese president has made rather frank comments about the independence movement in hong kong. he made those comments when he met top hong kong officials for a meeting. essentially he praised them for effectively curbing the independence movement. i think it is worth noting that the independence movement is not a mass movement. and also, if you look at a series of opinion polls, it would suggest young people are moving away from that movement. there is less support for it. there is less support than a year ago. this is the el

in hong kong, 9:00 p.m. in new york. i am haidi lun. rishaad: i am rishaad salamat coming to from bloomberg's asia headquarters right here in hong kong. this is "bloomberg markets: asia." haidi: asia pacific negative after wall street's the kleins. rishaad: a new cyber attack adding to concern, affecting companies and institutions from russia to the east coast of america. takata shares collapsing after the daily limit was removed. rishaad: toshiba falling at its own hurdle, unable to finalize the sale of the chip unit right today's deadline. onare keeping an eye toshiba, looking ahead to reaction out of janet yellen what she has been saying and marriage draghi and that is how it is buying out when it comes to equities. looking at the markets themselves and etf's, i want to pull up a chart, #445, and this is the growth we have seen in the demand for these etf's, and now on pace to hit a record of $300 billion, topping 2015 and 2016 combined, growth driven by foreign buyers piling into these funds during the first half of seeking out u.s.

how independent is hong kong? we look at the relationship with beijing nearly two decades after the handover back to china. u.k.-based barclays bank including the former chief executive, have been charged with conspiracy to commit fraud. of dollars billions in emergency funding during the global financial crisis in two thousand eight. there is an agreement can barclays and investors in qatar. reporter: trash with criminal conduct, barclays and 4 members of the bank's top brass, including the former chief executive and head of barclays middle east. this is the first time they have faced criminal proceedings during the conduct for the financial crisis. rather u.k. government was using taxpayer's money to rescue lloyds, barclays came to qatar for emergency cash. in 2000 eight, barclays raised 12 million pounds from middle eastern investors, including qatar holding, the state aid investment fund. it was a sweetener. 332 million pounds was paid to qatar for advisory services. payments that were not disclosed her not on

it doesn't seem to have been working for hong kong. there's been growing angen for hong kong. there's been growing anger, division, and outright rebellion, which we haven't seen reports of over the years, and president xi is coming in and basically congratulated the previous regime and the new regime that's coming in today on how well they've sort of bush sat down. that doesn't really seem to be the answer —— sort of pushed that down. that doesn't really seem to be the answer in that free enterprise kind of model hong kong was meant to be. the question being asked is, is hong kong going backwards, rather than being a beacon for china and how it can progress? is it being sucked back into the, shall we say, less democratic system of the rest of china? is the new york times article about how that is holding china that? paralysed, doom, uk in terms of the way business sees hong kong as well — these things are being commented on in where hong kong is 20 years on after it's gone back into chinese rule. i think there are two ways of looking at this because china is itself on a

carrie gracie, bbc news, hong kong. and we will go live to hong kong to speak with our correspondent, so stay with us for that. let's take a look at some of the day's other news. after months of court battles, part of donald trump's travel ban is finally coming into effect. on monday, the supreme court partially upheld his executive order, restricting travel from six mainly muslim countries. the bbc‘s nada tawfik is monitoring this from new york. the administration, through the supreme court, said the ban could partially come into effect. they said those with bona fide relations in the united states would be exempt, so we saw the trump administration last night putting those guidelines in place on who they consider to have a bona fide relationship. they said those with close family ties, such as a daughter or a child or a spouse, could travel to the united states, could apply for a visa, as well as those who had a job offer, or were a student studying, or a journalist on assignment. they would be considered an entity

here is one thing that seems to have concerned many people in hong kong, the disappearance of hong kong publishers at the end of 2015, to appear in prison cells inside mainland china. the disappearance earlier this year of a chinese businessman who has com pletely chinese businessman who has completely vanished, disappeared from the streets of hong kong. if that kind of thing ok? from the streets of hong kong. if that kind of thing 0k? the hong kong police force has been working on the case and trying to collect evidence, unfortunately, without the cooperation of the people involved. it is not possible. do you think it is possible that those hong kong citizens are afraid to speak up about what happened to them, is that about what happened to them, is that a possibility? i don't know, i don't know but of course i always have this to say to people who have fears and worries, they have to trust the rule of law. how many hong kong citizens need to disappear before we draw conclusions about what might be happening to them?” draw conclusions about what might be happening to them? i think th

in hong kong when the whole issue of hong kong seemed to be at the heart of what i thought was a crazy argument suggesting that asia was somehow unlike every other part of the world and there was an asian economic model which was not believing in democracy and freedom of speech. but you look at asia frto japan there's all sorts of models. there's nothing confusion about shenzhen, there's something democratic about taiwan. i always that you it was a crazy argument i think people are the same the world over >> lord pa ashgapatte, let's che gears for a moment and talk about the newly formed alliance between the dpshup and the conservative party a lot of people call it a fiasco in your own words, what would you call it? >> i think it's mistaken for three reasons. first of all, actions have consequences you give people a bong in order to support you, sooner or later they come back for more. >> you say it will cost the uk dearly and the conservative party. >> to think this is the last time the dup will ask for loot is crazy of course they want more spending, but so does scotland, wales, part

hong kong has always been in my heart. just two days later will be the anniversary of the return to the motherland, to the country is a hugit isa huge thing to celebra. this is visits to hong kong and three major purpose to send our best wishes and celebrate the achievement over the years and best wishes to achieve again results. for 20 years the center of government has been supportive of a woman to support the lives of our people and the plans future we would like to go with you to learn over the 20 years and even full and non- eventful experience and to some. the one to be practiced. i look forward to experience the development and progress achieved and the new changes made. we will definitely enhance our belief in developing hong kong. thank you, everyone. plus the president there at the international airport. it is quite frank to say that he wants to wish his best in show support. how do you feel this purpose of visiting? >> e. must be happy to be here today and for the coming three days. i think that it will make mos

the hong kong sar. more coming up. an advisor to the cbrc in beijing in the next half hour. back to you. >> we look forward to that conversation. thank you. one feature on the bloomberg we like to bring to your attention is our interactive tv function that you can find going to tv . you can see previous interviews and dive into the securities are functions we talk about. you can also become part of the conversation. send us an instant message on the left aside of your screen, ask a guest a question. this is for bloomberg subscribers only. check it out at tv . this is bloomberg. ♪ >> welcome back. a quick check of the business flash headlines. a haltia 10 network and of the key shareholders decline to guarantee a new loan. they decided say not to back a 250 million australian dollar credit line to replace an existing overdraft in december. the network reported a first-half net loss of 232 million australian dollars. saying amack moran deal is in sight. plannedon is running as despite a strike t

our greater china markets editor in hong kong. we stay with hong kong. nearly two decades after the some say hong kong has slipped off the pace when it comes to the fields of technology.nd in fact, losing out to the likes of singapore, which has been pushing to be the first smart city state. stephen engle has been looking into this. what can the hong kong government and private groups due to engage more when it comes to innovation and encourage startups to make their homes in hong kong? stephen: one thing they could really do, and what they are doing, is looking across the border to that warmer sleepy fishing village of shenzhen. it is transforming itself over the last 20 years. you cannot talk about the 20th anniversary of the establishment of the hong kong sar without noticing what is happening across the causeway, if you will, in shenzhen. one of the biggest success stories and innovative front is the big drone makers. the world largest consumer drone maker, we have the chair me -- xian.an here, dr. li is hong kong losing out to places like shenzhen,

you think so, what if other hong kong citizens disagree? what if they wanted to call for independence? they disagree in the form of being an expression of personal opinion, then everybody could have a view. you could condemn him and so on. but whether that expressing a view constitutes an offence, then we'll have to look at what the law says. what's the answer? we'll have to look at what the law says. can you promise the people of hong kong that never in your tenure will someone go to jail for calling for autonomy, self—determination or independence? well, i can promise the people of hong kong that we will abide by the rule of law. so that's a no, you can't make the promise? no. how can you promise when you don't know the actual situation, when you don't know the actual legislation in hong kong and to give a, sort of, perpetual situation answer, i don't think that is a very fair question to ask. china's influence in hong kong is growing — some of it open, some of it not. last year there was public outrage over the suspected abductions o

we should be standing up for people's writes in hong kong and for the system which has made hong kong so special. you saw the scenes unfold in 2014, what was your reaction to that and do you think the call for independence of the young generation is the right one? what i thought about those demonstrations in 2014 was what i guess most people thought and they were not manufactured from outside, this was spontaneous within hong kong. and was the most polite peaceful protest with a few odd exceptions. they were the most polite and civil demonstrations imaginable. it is crazy china has behaved in a way which treats them as enemies and turns them off the very notion of being closely related to the mainland. the one thing that they didn't know and i think it is a lwa ys they didn't know and i think it is always a problem with big demonstrations, they didn't realise the point at which they had won and that it would've insensible to stand back and ensure all the pressure was on the other side because they had w011 on the other side because they had won the moral high ground. and then what? yo

my biggest worry about hong kong wasn't that the tanks would roll in from the north but that hong kong would simply become the richest city in china. i don't think that is going to happen so long as hong kong can hold onto the rule of law, independentjudiciary and all of those things. they are crucial for business. and all of those things. they are crucialfor business. even and all of those things. they are crucial for business. even some chinese businesses feel they have to go to hong kong to sign contracts with one another because that way they can be properlyjust —— justiciable. it is the rule of all which makes hong kong special and will mean it has advantages over shanghai or other chinese cities. now to india, less than a year after the high—value currency notes were removed from circulation, another ambitious reform initiative — the goods and services tax, gst. the country's 1.5 billion people live goods and services tax, gst. the country's1.5 billion people live in 29 separate states and each of those states has its own tax arrangements. as of tomorrow, the gst replaces

in hong kong -- new york. this is bloomberg. ♪ ♪ we are counting down to asia's first major market open. nikkei futures carrying the rally today. tech shares and financials in the u.s. -- this is "daybreak asia," i am betty liu in hong kong. -- in new york. yvonne: i am yvonne man in hong kong. scott minerd, it is good to see you. i know you have a different take on what the ecb did the last 48 hours. a lot of people are asking if this will be the pivot for the markets. do you see this as an inflection point? last 48moves in the hours sustainable in your eyes? scott: i do not think this is the inflection point. one thing i have been talking about is, the vulnerability of markets to a surprise announcement of some kind. given where volatility is, where the market, when it gets to this characteristic, is typically vulnerable to some piece of bad news that comes out of the blue. i am not ruling out the possibility that as we go through the summer, and the federal reserve i think in september or october will s

a great day in hong kong. thank you so much for joining day in hong kong. thank you so much forjoining us. let's take a look at some of the day's other news. cyber security experts now believe a global ransomware hack may have started with corrupted updates on a piece of ukrainian tax software. the attack has spread to at least 64 countries. governments, ports, banks, oil companies and airports were all hit. a so—called vaccine has been developed to stop the immediate spread of the virus. but more cases are still being reported. earlier, michael chertoff, executive chairman of the chertoff group and former us secretary of homeland security, told the bbc that cyber attacks could increasingly become central to conflict. as with many people within intelligence feel, ifeel this is probably the most serious threat currently we face. first of all, the terrorists, although they have not yet used cyber attacks as a destructive tool, rather than a recruiting tool, they may decide they want to do that. you have the north koreans who have shown very little restraint

xi arrive here in hong kong. toshiba never far from the headlines. over the delay of its memory chip business. it hadek toshiba saying a preferred bidder, doing very well in tokyo. that's on the back of its first quarter buffet. hsbc in hong kong, what were seen in the banking space across asia following the rally on u.s. banks after they passed the fed stress test. we are watching the 20 or handover of hong kong to china. hong kong stocks have done incredibly well over the past year. up by about 18% on the hang seng index. we were told hong kong next to continue to be the front runner in the global equity space, and hong kong could one day rival u.s. as the trading hub. interesting to see what's happened of the last 20 years. manus: thank you very much, juliette saly. the biggest banks in the united states of america announce a share buyback and plans to boost dividends after the fed says that more than in us capitol. su keenan has the details from new york. >> 33 banks past the test with lying colors. one was k

we go live to hong kong. tell us how it looks from the? -- there? the chinese president is expected to arrive in about four hours, every day ahead of that arrival we have been seeing small—scale protest against him and this visit. last night, a protest took place in the compound behind me, about two dozen pro—democracy protesters were arrested. there is still tension, they have not yet been released. we are expecting more protest to come, we don't think that the chinese president will come face—to—face with any of these demonstrators. he will be arriving around midday, he will be arriving around midday, he will be arriving around midday, he will be taken by motorcade. there will be taken by motorcade. there will be taken by motorcade. there will be a lot of security and he will be a lot of security and he will be a lot of security and he will be taken to the area behind me. he has several trips in his itinerary. he will be visiting to museums in beijing, he will also be looking at some transport links between hong kong and china, attending s

in hong kong, 11:00 a.m. in sydney. i am haidi lun. rishaad salamat, coming to you from bloomberg's asia headquarters in hong kong. this is bloomberg markets. haidi: asia-pacific stocks start the week in positive territory. remainingakata untreated, having been suspended last week. selloffs outweigh bids by 600 to one haidi:. toshiba said to be near a winner. incj are ahead in the field. rishaad: hong kong want to ensure it does not miss out on the next big thing. a reading on house prices in china. we are seeing pier 1 city house prices just inexorably rise. we have had this absolute run-up of late. expecteing how -- you bad loans at the same time. nonperforming loans. quite the reverse since march orer december of -- march december of 2015. people are not getting themselves into huge amount of debt. we have those numbers coming out in about half an hour. haidi: always interesting to look at that breakdown between the big cities and the second, third, or even fourth tiered cities. this is a recovery we have been seeing it we are watch

in hong kong. 9:00 in hong kong. "bloomberg is markets asia." ♪ rishaad: the markets are way down by weak u.s. job numbers and the terror attack in london. haidi: theresa may will take new hours if she wednesday election. she said after the weekend says extremism has been tell rated for too long. -- tolerated for too long. rishaad: terrorism is said to be the leading threat in 2017. haidi: there could be a deal where 267 billion dollars is in talks. we are looking at politics. secretary -- we have the defense secretary in sydney today. there are other counterparts here in australia talking about some of these geopolitical risks in the region. we have heard about the prime turnbull, lastlm week, saying australia needs to do more to rein in terrorism. take a look at the chart. 1957, you have to wonder if this is going to come up in these conversations. it is quite clear, if you take a look at the white line, the percentage of gdp, the u.s. is outstanding -- outspending china and australia. this goes to the heart of w

in hong kong. i'm haidi lun. rishaad: i am rishaad salamat coming to you from bloomberg's asia headquarters in hong kong. this is "bloomberg markets: asia." ♪ haidi: tackett leading a should down as investors weigh the impact of the u.k. political drama, sterling paring losses after its biggest fall in a month. rishaad: theresa may clinging to power by embracing bitter rivals. business confidence is plunging. haidi: more disappointing news from the factory floor and japan , machine orders slumping, producer prices staying flat. rishaad: the long and short of it, hong kong stocks being targeted by skeptical researchers. of course all this political drama, the british election, james comey and his testimony to congress. having a look at gold. start toshed in and buy gold at times like this as a haven play. this is #502, a look at the last three weeks. have had three weeks of gold prices falling. never mind if you look at gold in sterling terms, but gold is priced in dollars. we could be heading for a negative fou

steven mcdonnell, bbc news, hong kong. as we just heard — president xi has been touting the success of the !one country, two systems" arrangement in hong kong, but back on the mainland — there's been a different message from china's foreign ministry — let's take a listen. translation: the china and british joint declaration no longer has any practical significant and it does not at all binding for the central government's management of a hong kong. the uk has no sovereignty, no power to rule or supervise hong kong after the handover. joining me now via webcam is professor steve tsang — director of the china institute at soas, the school of oriental and african studies. thank you forjoining us. as we heard, two different messages depending on the audience. why is it so important for china to mark this 20th anniversary? the president of china, xijinping, has decided to make this into an occasion and we have to bear in mind that for president xijinping, the most important event in the political calendar this year is t

we are taking a look at the shanghai and hong kong markets just kicking over to the open. shery: a pretty good start for the markets in china. the hang seng index gaining .7%, and you mentioned tech shares leading the gains, up 1.4%. the only sector losing ground is energy, although oil prices are gaining for a fifth consecutive session. regulators will start looking into that sell off of some small s we saw earlier in the week, 17 companies losing 40% of their stock price in the last few hours. gainingghai composite .2%. in the green, continuing that momentum we are seeing across asian markets. we are seeing materials lead gains in asia. take a look at the chinese 10 year. this is not updated. a survey of fixed income traders, they all expect the bond market in china to end its losing streak, the longest in six years, and may see gains in the latter half of this year by about the third quarter of this year, that sovereign debt rise and weekly see yields falling to lower levels than right now. they are predicting that 10 year yield will drop to three point 4%, the delevera

you think so, what if other hong kong citizens disagree? what if they wanted to call for independence? they disagree in the form of being an expression of personal opinion, then everybody could have a view. you could condemn him and so on. but whether that expressing a view constitutes an offence, then we'll have to look at what the law says. what's the answer? we'll have to look at what the law says. can you promise the people of hong kong that never in your tenure will someone go to jail for calling for autonomy, self—determination or independence? well, i can promise the people of hong kong that we will abide by the rule of law. so that's a no, you can't make the promise? no. how can you promise when you don't know the actual situation, when you don't know the actual legislation in hong kong and to give a, sort of, perpetual situation answer, i don't think that is a very fair question to ask. china's influence in hong kong is growing — some of it open, some of it not. last year there was public outrage over the suspected abductions o

let's go live to hong kong. when we talk about political issues, i guess we are really talking about is moves towards independence for hong kong? absolutely. the president made those remarks at a meeting of top hong kong officials, he praised them for effectively curbing the independence movement. it is worth mentioning the independence movement is not a mass movement, it isn't mainstream. if you look at a series of political poles, public opinion polls, i should say, you will see the younger people especially seem to be supporting this movement less than they had been just a year ago. supporting this movement less than they had beenjust a year ago. so let's support for the movement and of course the fact there is any movement of this kind at all in hong kong is something that worries the chinese leadership, it worries the chinese leadership, it worries the chinese president xijinping because he doesn't want to see any of this spread from hong kong to the other autonomous regions in mainland china itself. so he

kong, he will look at transport links between hong kong and china, he will be attending celebration events. of course, the major event is saturday morning when he will swear in the next chief executive of hong kong. he is likely to leave before the mass pro—democracy protest, which will be happening on the afternoon of saturday. so, he will be leaving before those marchers start. but of course he will no doubt be aware of them. 30 years of the hillsborough disaster six people including former police officers will face criminal charges. 96 liverpool fans died in a crush at the football ground in april 19 89. an inquest last year concluded the fans were unlawfully killed. 0n concluded the fans were unlawfully killed. on wednesday it was announced former chief superintendent david duckenfield will face charges of manslaughter by gross negligence and five other figures will also be prosecuted. donald trump is sounding optimistic that republicans can push through a bill to change healthcare. it's not looking good, though — senate leader mitch mcconnell has been forced to delay a vote

hong kong remains a feisty say. pockets of the old hong kong around every city. mean for does brexit hong kong's future? gov. patten: we're told that brexit means global britain and we will take on new markets. i worry that in relation to china, we sell nine times as much to the european union as to china, it will increase the tendency to think that in order to do business with china you have to count out politically. i can see that feeling increasing if we are outside the european union and do not have the immediate support of oureu colleagues. tom: we will continue with lord patten, maybe find out how oxford is doing. lord patten to continue with us. july 4 is a day when the colonies got upset. worldwide.pops tuesday, july 4, 8:00 p.m. this is bloomberg. ♪ the switch yesterday as deutsche bank went to a strong euro. they have been good on that for 24 hours. we will be joined from deutsche bank on the center pack. this is a new phrase he is a coordinated response of central banks as they attempt to raise rates. he will join us at the top of the 6:00 hour. guy

they have all the links between hong kong-shanghai, hong kong-shenzhen. this would be a move in the right direction. last year, the decision went against china, you saw the yuan selling off. a-shares are denominated in renminbi. it would be moved toward the greater international use our -- of chinese currency.in terms of what you hear from morgan stanley , they have said that reforms are going in the right direction and i think it is time this happens. of course, there are risks around corporate governance, and somewhat argue if you get more foreign government involved, that would be improved. stake forte a bit at beijing's assets. thank you. still ahead, more on the implications of the msci decision on asia. also, is it the game changer it is thought to be? rishaad: u.k. government turning soft on brexit? we break down day one of the negotiations next, was global chief economist -- with a global chief economist. this is bloomberg. ♪ rishaad: a quick check of the latest business flash headlines. australia's competition tribunal half cleared a bid for a

carrie gracie, bbc news, hong kong. let's take a look at some of the other stories making the news: the governor of new york, andrew cuomo, has declared a state of emergency on the city's subway. he says its dismal performance is wholly unacceptable. two days ago a subway train derailed in northern manhattan, injuring dozens and raising concerns about public safety. the governor has announced an extra $1 billion to improve the subway. venus williams has been accused of causing a car crash that led to the death of a passenger in another vehicle, according to a police report. the former world tennis number one was driving her car in florida when the accident happened at a crossroad. a 78—year—old man suffered injuries, and died two weeks later. venus williams was not hurt. in venezuela, protestors have returned to the streets, continuing three months of anti—government demonstrations. the attorney—general‘s office says there is evidence of the excessive use of force against demonstrators, and has called the form

hong kong links its currency to when.s. dollar in 1983, negotiations between beijing and london over hong kong's return to chinese rulspurred a capital exit us. betty: southeast asia's biggest online luxury retailer is planning to raise as much as $150 million working with credit suisse and goldman sachs. they want to boost the marketplace business and expand in south korea. the eight-year-old startup was valued at $300 million in late 2013, making it the most valuable luxury e-commerce art up in southeast asia. yvonne: amazon says it will try to keep whole foods' reputation while cutting prices. they --old to expect they expect to cut some staff to allow them to compete with walmart and other box store retailers. in 1992.blic -- it went public in 1992. betty: a dark cloud may be building among emerging economies. the lack of new saint haven assets is creating a dangerous overreliance on treasuries. we have seen numbers that show foreign investors are buying these the west bonds. alicia garcia herrera, the chief asian-pacif

the constitution of hong kong. what about the future because at china promise to respect townhomes capitalist system until the year twenty forty seven what happens after that? well and nobody knows exactly what will happen if beijing will still wants to keep that of one country two systems principle. or. eyes it was said in. and. in nineteen ninety seven that hong kong will become a normal city it and. in china like oliver. city in china i would integrate definitively the. the. dig communist system. off. continental china that's what a lot of people are worried about that which is for that's why you see so many young people taking time exactly because the young generation. of been expecting something to change and we've been pressing also the old opposition parties to be more. to come from the. dissension government. on the on the issue of the constitution and. it is probably why into thousand fourteen they decided to take a street and to. to make a more violent approach to. to the central government. just because

it was the incoming chief executive for hong kong. msci has decided to include china's a shares in its emerging markets index. until now, only chinese shares listed in hong kong were part of the index. msci compiles global stock market indices all lists of companies that investors use as a benchmark for investing decisions. earlier i spoke toa investing decisions. earlier i spoke to a correspondent in hong kong and asked why this decision was important. it was a widely expected decision, capping a process that took overfor years. decision, capping a process that took over for years. during that time msci had been speaking to investors around the world as well as chinese regulators in an effort to bring asia into this highly influential index. in the last three yea rs influential index. in the last three years the proposal was rejected because of market access issues. foreign investors were unable to get access to the shares to buy or sell as they saw fit. this time the proposal was scaled down from over 400 stocks to 169 stocks in the

he said he'd come to support hong kong. protesters chant that's not how democracy activists see it, occupying a monument that china presented to hong kong for the handover. one student insisted on herfreedom to protest as she was arrested. hours earlier, she had illustrated her feelings about the chinese communist state. a hong kong flag in mourning. a veteran protester at 20. but she's no longer optimistic about what protest can achieve. another hong konger, born in the year of the handover. coffee shop barista and freestyle footballer lai cunyin busks to make ends meet. in one of the world's most unaffordable cities, he resents the people from mainland china who he says are pricing him out. to find a 20—year—old who's celebrating this week, it's best to look for a mainlander. sunny tan is a student here, but she grew up in china and from an early age was taught to be proud of her country. free liu xiaobo! some celebrate, and others mourn. this vigil, calling for the release of a political dissident, would be impossibl

rishaad: i am rishaad salamat in hong kong. peach aviation says it may take until the end of this fiscal year to develop a bitcoin payment system. the airline announced in may it would accept the crypto currency , hoping to encourage customers from regional japan and overseas. we decided to step forward and do this initiative with bitcoin has a way to bring expanded choice. considering as you mentioned the volatility, we have to do this responsibly and in an effective way, so we are now working to develop the payment system. that should be finalized by the end of this fiscal year. an auto company may the likes ofith fiat chrysler as it maps out a route to sell vehicles in the u.s.. the company plans to enter the market in 2019, and the general manager says it is examining a range of options. there is already a joint venture with fiat chrysler in china and would not rule out cooperation in the west. a group of 20 global institution investors as 33 of japan's largest companies to improve corporate governance i appointing independ

hong kong is braced for the arrival of the chinese president xi jinping. he is due to arrive in the next couple of hours to mark the 20th anniversary of hong kong's handover from britain to china. it's his first visit as chinese leader and protests are expected. 26 pro—democracy activists were arrested on wednesday. the last british governor of hong kong, chris patten, has said their campaign can't be ignored. the campaign to protect the rule of law, to protect due process, to stop people being abducted on the streets of hong kong with the chief executive turning and looking the other way, i think all that is really, really important and i don't think the rest of the world should ignore it. i think the way that china keeps its commitments and pledges in hong kong will tell people an awful lot about whether china can be trusted in this century. earlier i spoke to our correspondent juliana liu about the unrest that has been building there. democracy activists will impact the chinese president, if at all? ? protesters have been conducting small—scale guer

the stock connect with hong kong increasingly are game changing. they are allowing the world to whicho china in a way in they were predicted to do so. be on sure.ed to you don't need to be part of the chinese stock market to be buying or selling these stocks. that will be a change. henry fernandez did mention that there are daily quotas, daily limits on how much trading can happen. he was hopeful those get lifted. lifted, who knows how much you could see each day. haidi: this fits in nicely with the year of political consolidation. what does it say about beijing's reform efforts and what is still left to be done going forward? you can expected to be touted by the leadership as a concrete example of opening the financial markets as they have been long saying they would do. many skeptics will say it is a piecemeal approach, particularly ,round the yuan, the renminbi whether they have taken a step back on that. others say it would help internationalize the use of the renminbi, something chinese policymakers have long wanted to do. these are value domi

reporter: how about hong kong? moody's just downgraded hong kong along with china. there is a lot of talks about the anniversary of the handover in 1997. there are parallels, the property prices have gone past peaks.7 you see a risk of a crisis? >> i don't see a crash happening in hong kong anytime soon. for hong kong, as long as the chinese economy is going reasonably well, hong kong will do all right. raise thebut they stamp to 15%. they almost doubled it. that didn't suppressed prices. what does that tell you about the continued chinese demand? >> >> the chinese buyers want to buy a piece of property in hong kong. there's been talk about the depreciation, so buying in hong kong is probably the safest ask for them. reporter: now revenue is going stronger compared to the dollar. >> better gains in the foreign-exchange, nobody knows. had tor: as we hot -- july 1, whether the expectations of the new chief executive? have you rates are so far and what is going to be her biggest challenge? do a good job because she has been in civil service for over 30 years. she knows

our correspondent joins us now from hong kong. what is expected today? the chinese president expected to land around midday, but his visit has already been marred by a series of small—scale guerilla type protests. the latest one overnight happened just behind me, about two dozen pro—democracy protesters were arrested. they were demanding greater voting rights for hong kong, as well as the unconditional release ofa as well as the unconditional release of a chinese civilians. we believe they are still in police custody. we are also expecting more smaller scale protests to come. most protesters are unlikely to be able to get close to the chinese president, however. he will be giving a speech and will then be taken to the area behind me. that area is already in lockdown. there area is already in lockdown. there are reports of over 10,000 police officers on patrol to safeguard his visit. in the following days, he will be attending a variety show on friday night and saturday morning. he will be at the swearing—in of the incoming chief executive. what kin