 Welcome to the Asian Review. I'm your host Bill Sharp returning to host the show after a one-year hiatus doing research in Taiwan. During my year away, I met many interesting highly knowledgeable folks that I hope to invite onto the show for everyone's benefit. So be sure to stick with us and watch us every week on Monday afternoons. Today, my guest is one of those interesting highly knowledgeable folks. Attorney Ross Feinbold is Senior Advisor at DC International Advisory with offices in Hong Kong and Taiwan. He's a highly sought after commentator who will share his insight with us on contemporary politics in both Taiwan and Hong Kong. Mr. Feinbold is living in Asia for 22 years and is often interviewed in Mandarin Chinese, which he is quite comfortable in. Will the Trump administration show greater interest in Taiwan and Hong Kong than through the Obama administration? Obviously, we want to talk about this and about Taiwan President Tsai Ing-wen's call to President-elect Trump. Ross, welcome to Asian Review. Good afternoon. Okay. By the way, Mr. Feinbold is joining us from Hong Kong today. Well, let's get right into it. President Tsai Ing-wen's congratulatory call to President-elect Trump. What's your take on that? What's the impact? Well, clearly there's a desire by people who are going to staff the Trump administration to have a closer relationship between Taiwan and the United States. And there are several factors behind that. Most notably is a strong feeling that Taiwan is a fellow democracy. It's a country that generally respects human rights and shares many governing principles in common with the United States. And it should be treated as a normal country and as a friend of the United States. So some of the restrictions that have existed in the relationship between the United States and Taiwan, many people who are going to be working in the Trump administration feel very strongly that these restrictions on things like high-level visits between the government officials of the two countries, or weapon sales, etc., are completely unnecessary. And the United States should not be taking its instructions from China with how the United States should conduct relations with Taiwan. So on that basis, there will be significant changes under the Trump administration. Well, President Tsai's approval rating was suffering, to say the least. Do you think that her call to Trump helped her approval rating, or hurt it, or had no impact? Up or down? Well, now that it's several weeks after the teleconference with President-elect Trump at the time, it's clear that the approval rating continues to slide for Tsai Ing-wen. And most of that has to do more with her handling of domestic issues, more so than foreign policy issues. So there are a lot of ongoing debates in Taiwan about various domestic policy issues, economic policy issues, etc., and it's having a big impact on the approval rating of not just herself, but her governing team, the ministers in her cabinet, for example. And that's why her approval rating is falling. So there may have been a brief moment of approval rating increase and appreciation, and the public was impressed that Tsai's government was able to have this significant achievement with the incoming United States president. But I think it's also fair to say that a month later that has already dissipated, and the attention of Taiwan's public has returned to day-to-day economic issues. Interesting. Well, you're a close observer of events in Asia in general, but particularly Taiwan, Hong Kong, and China. So what kind of grade would you give Tsai Ing-wen on a scale of 1 to 100? Well, that's a really good question. Most of her ministers, when they've been asked this question by opposition members of parliament, have tended to give themselves very high ratings, between 90 and 100. So maybe I should second-press the view from the ministers in her own government. But there's some key points to keep in mind. Her government, her as a president and separately the members of the legislature that control the legislature from her party were elected overwhelmingly a year ago about this week. So they have a very strong mandate to govern. Sometimes it's very difficult to meet the expectations that the public had when they gave them such a strong mandate. So they have an overwhelming majority in the parliament, the legislative union. President Tsai was elected overwhelmingly against her two opponents in the presidential election. So public expectations are high, frankly. It could be very difficult to meet those expectations. And she started off with a huge amount of political capital, but obviously over time that will dissipate. And again, a lot of it has more to do with economic issues. And economic growth in Taiwan continues to be very sluggish. Do you think the Taiwan public is a little bit unfair in other words, it has such high expectations, it expects very complicated problems to be instantaneously solved? And on the point that you mentioned about instantaneous solutions, there are numerous television news channels in Taiwan. So it's a small country with a population of 23 million people, but there are close to 20 television news stations, newspapers, online media outlets. So all issues, all sides of the debate of a proposed policy, a vote in the parliament, get deciphered very rapidly and sometimes very heated views from both sides. So that also makes it very hard to achieve the expectations that the public set out. But there was a recent incident this week where there's a dispute over changes to Taiwan's labor law and over time pay. And both labor groups and employers are unhappy with the execution of this new law. And it's been frustrating for both labor and for employers as well as for the government. And President Xi basically said to the media, well, stop complaining to the government. I think labor and employers should work out the issues amongst themselves. We've set the policy and you guys should figure out the details. That may be a very reasonable view to take, however, it was not a popular statement with the public. Interesting response. China's reaction to the Trump call was, I think it's fair to say, predictably blustery. What are the reactions of other regional powers to this call? What's your sense? I mean, well, this is in the region who obviously watch what's going on quite closely. It goes to Taiwan's ability to establish stronger political trade or security relationships with other countries around either North East Asia, which would be Japan and Korea, or Southeast Asia, the ASEAN members, or with India. Right now we're in a period of great uncertainty because we don't know the level of engagement the Trump administration will have with Asia and how it will implement policies with regard to Asia. And most specifically, will it be confrontational on trade issues, which wouldn't just be a problem vis-a-vis bilateral relationships with China, but it could impact other countries in Asia as well. So countries around Asia are being very cautious in how they manage their relationships, both with the United States and with China. What does that mean for Taiwan and the teleconference between Taiwan and Trump? Well, countries in Asia are being very cautious. They're being very cautious right now about deepening their own engagement with Taiwan, until they see how the U.S.-China-Taiwan-Trilateral relationship plays itself out. So while we didn't see countries around Asia saying the call was a great thing and a very supportive of a closer U.S.-Taiwan relationship, they weren't necessarily critical, either with a few exceptions, notably Singapore, which has been very outspoken in recent weeks that the U.S. should maintain the one China policy. However, that's not going to influence the decisions of the Trump administration, but it may look good in front of China for Singapore to say that. Is Trump using Taiwan as a bargaining chip? We really don't know yet. He has said as much in public statements or immediate interviews. But again, a lot of the people who are going to be making Asia policy in the Trump administration, some of whom have yet to be appointed, so we don't even know who these people are. But again, I think it's a safe assumption that many of the people making Asia policy in the Trump administration will favor closer engagement with Taiwan. We don't know the extent of what that will be, but it's a safe assumption that there will be higher-level visits from Taiwan officials to Washington D.C. and from U.S. government officials to Taipei. It's a safe assumption that the U.S. is going to offer better military equipment for Taiwan to purchase. Whether or not Taiwan will make the budget available remains to be seen. But again, it's a safe assumption there will be a higher level of engagement between the United States and Taiwan, regardless of who staffs the Asia policymaking positions in the Trump administration. Interesting response. So we don't know whether Trump would throw Taiwan under the bus in order to get a better deal or trade deal from China. It's probably a little bit too early to tell. Absolutely too early to tell. And even though Trump has made statements indicating that he might treat Taiwan as a bargaining chip in trade negotiations with China, I mean you could see just from constructing that statement that we have a few issues that actually might be very unrelated. So yes, Trump is going to look to recalibrate the trade relationship with China. That could mean higher tariffs on Chinese goods or other actions that the United States could take either under domestic policy or within the WTO framework. Whether that can be linked to Taiwan issues though remains to be seen. So it might sound like some bluster right now but maybe that there's little likelihood that Taiwan would be thrown under the bus. Well that's good to hear. That's good to hear. Let's focus our attention now on Hong Kong and Mr. Fungold is today as we speak to him is in Hong Kong. How many days a week do you spend in Hong Kong? How many days a week do you spend in Taiwan? I travel back and forth constantly so on any given day I might be in one city or the other. Of course with the election and the new government in Taiwan over the last year I spent more time in Taiwan analyzing that. But we have an election upcoming here in Hong Kong this spring for the chief executive. Of course the big difference with Taiwan is the chief executive in Hong Kong is not popularly elected and that's what causes so much tension between the public and the voters in Hong Kong because their expectations for democracy have not been met. Okay so since you are looking at the upcoming Hong Kong election for the chief executive of the Hong Kong special administrative region what are your thoughts on this upcoming election? Well again the public's expectation for direct election this cycle was not met that led to a lot of protests in the last few years but they are going to proceed. They being the current government of Hong Kong which designed the policy and ultimately the authorities in Beijing. So the chief executive will be selected by a small group of prominent people who represent what Hong Kong calls functional constituencies such as different industry groups labor unions and the like and the expectation is it's going to be one of a small group of people who have senior level government experience. They may not all get along with each other they might have personal disagreements on various domestic policy issues such as public housing policy for example but ultimately they will be cooperative with Beijing and they will not look to set a policy course that would differ from what officials in Beijing want to see for Hong Kong. So in that sense there will be stability. On the other hand if their policies are too close to Beijing and don't meet public's expectations there will be return to tension in Hong Kong. So let me ask you a hardball question now. Is Hong Kong better off as a special administrative region of China or was it better off as a British crown colony? Or the other option which is increasingly discussed in Hong Kong although unlikely to become reality is an independence movement that now exists in Hong Kong. For Hong Kong separation from China. Obviously it's not going to happen. One clear distinguishing phenomenon over the last 20 years since the return of Hong Kong to Chinese control is that there is not a colonial government of officials from Britain making the significant decisions for the people of Hong Kong. So the decisions now are made by the people of Hong Kong and or officials in Beijing but at least it's not made by a country from very far away. Hong Kong people and companies for example have greater control over the course of Hong Kong as opposed to British officials or British companies having say over policy and and winning bids for public construction contracts and the like. So there is something to be said for Hong Kong no longer being a colony. Again though one of the great disappointments of the people of Hong Kong is that they do not directly elect their legislature or their chief executive. Unfortunately it seems very unlikely that there will be direct popular elections and in your term. Okay so um hello my name is Crystal let me tell you my talk show I'm all about health. It's healthy to talk about sex. It's healthy to talk about things that people don't talk about. It's healthy to discuss things that you think are unhealthy because you need to talk about it. So I welcome you to watch Quok Talk and engage in some provocative discussions on things that do relate to healthy issues and have a well balanced attitude in life. Join me. Aloha I'm Carl Campania host of Think Tech Hawaii's Movers, Shakers and Reformers. I hope you join us over the next several weeks as we take a deep dive into biofuels in Hawaii and explore the alternative fuels supply chain necessary for the local and global transition towards transportation fuel sustainability. Join us as we have good conversations with our farmers, our producers, our conversion technologies, our investors and our legislators as we try to achieve our transportation sustainability goals. See you soon. Welcome back to Asia Review. I'm your host Bill Sharp. My guest today as well as Fine Gold joining us via Skype from Hong Kong. Before the break we were talking about the upcoming election for the chief executive officer of the Hong Kong Special Administrative Region. We're also talking a bit about comparing Hong Kong as a British Crown colony versus its current status as a Special Administrative Region of the People's Republic of China. So we'd like to resume that line of questioning for our last 12 minutes or so. Welcome back Ross. Do you think there's more freedom in Hong Kong today than there was during the days of British rule? It's a very fair question and it's an issue that people in Hong Kong are struggling with. Clearly the ability to express one's views, to have public demonstrations, exists in Hong Kong at a greater level than across the border in China. And this is still the case and it's something that Hong Kong people value very dearly. There's a greater level of popular opinion reflected in public policy. So although it's not a fully direct election for legislators and chief executive, one could argue that the current electoral system for the legislative council and the chief executive does allow a greater level of public participation than existed under the colonial government. This is just a fact, but again as we were discussing in our earlier segment it doesn't achieve the public's expectation for a fully elected, by popular vote, legislative council or chief executive. The concern though is where do we go from here? So people can express their views relatively freely in Hong Kong. One could criticize government officials in Hong Kong. Again there's things you can't do across the border in China, but the clock is ticking. Hong Kong has 50 years to have its own system and after 50 years there's no guarantee. So the clock is ticking and between now and the next decades there will be small and subtle changes probably in a negative direction where people will become more constrained in their ability to speak out. The media might self-censor more than we see today in Hong Kong and these are certainly things to watch and frankly I think they're going to be people in the Trump administration and in the United States Congress who are going to be looking at this very closely. So not only are people in Congress and the Trump administration going to be looking at China's relationship with Taiwan, but they will be looking at China's relationship with Hong Kong as well. You know one thing that strikes me about Hong Kong is as I see it there's this great division between the older people in Hong Kong and the younger people, all those young people who are out participating in the umbrella movement, you know carrying out sleeping on the streets and that sort of thing. Pushing for what I would call a better, freer tomorrow versus the older people say well well wait a second you're getting in the way of business you're stopping business and I don't know those I have to admit personally the attitudes of the older people left me a little bit high and dry. What's your take on that? Is there does this form any kind of a polarization in Hong Kong society? It certainly does a bit. Keep in mind that older people in Hong Kong would have been witness to very momentous changes in events over the last few decades whether it was the handover or the period between when Britain and China agreed on the terms of the handover and when the handover actually occurred which was a period of great uncertainty because people weren't sure how the handover would work in practice or going back through the decades Hong Kong has faced various pressures such as influx of Vietnamese boat refugees or riots in the 60s instigated by China during the Cultural Revolution or going all the way back to the Japanese occupation during World War II. So older folks in Hong Kong have seen a lot of change and they might have a bias and a preference for stability and most notably economic stability. So when you say that their concern was the young people who are disrupting business it could be very understandable that that people are concerned about the economic stability which is what Hong Kong's prosperity is based on right it's based on historically it was manufacturing and services now it's more focused on services and trade facilitation and that's based on having a high level of stability here so it's understandable what the concern is but I think it's also fair to say that even older people do have a preference for direct elections of the political leadership in Hong Kong but the difference of opinion and clearly is how do we go about doing that and older folks are unlikely to sleep in the street as you mentioned which the umbrella protesters did in when they occupied parts of the downtown of Hong Kong for several months at the end of 2014 so clearly there's a disagreement on tactics the goal they might actually share interesting you know another issue has come up in just the last few weeks is this the impounding of the Singaporean military vehicles and in Hong Kong port as far as I know there still have not been released is that correct correct they have not been released and it's a source of extraordinary frustration for the government of Singapore the government of Hong Kong is clearly caught in the middle in a political issue between Singapore, China and Taiwan because these military vehicles were returning from a training exercise in Taiwan as some of your viewers may know Singapore and Singapore has conducted military exercises in Taiwan for about 40 years it's not something that China likes China repeatedly expresses its pleasure everyone knows it goes on it's not a secret but for China it was extremely frustrating when it became public news with these military vehicles being impounded in Hong Kong the customs authorities of Hong Kong and the government of Hong Kong they do have a legal basis for impounding the vehicles in the sense that the manifest did not clearly indicate that this kind of cargo was transiting Hong Kong and there was a technical violation of Hong Kong regulations in that regard but clearly we're now in a political dispute between Singapore and China hmm well um now you're familiar um with with events in Singapore I think as well as in Hong Kong and Taiwan because I know that you study Chinese for a period of time in Singapore um it seems that the relationship between Singapore and China is intensifying it's it's it's hitting some some bumps in the road what's what's your take on that oh there are three significant issues over the second half of 2016 that caused this bump in the road in the relationship uh although the precursor there should be to keep in mind that Singapore is one of the largest foreign investors in China there are hundreds of thousands of PRC nationals who live in Singapore so so the relationship is extremely tied in in economic and personal spheres but three significant events over the course of 2016 one is Singapore was a a champion very outspoken champion for the Trans-Pacific Partnership which China of course perceives as a trade agreement to contain China and bind Asian countries closer to the United States second issue was the South arbitration C arbitration award in favor of the Philippines where Singapore was very outspoken in saying China should respect the award China did not like Singapore taking such a strong view especially as Singapore is not even a claimant to one of the islands or any of the sea areas third issue was the seizure of these military vehicles in Hong Kong so China has a number of issues over which is very unhappy with how Singapore has approached it the problem for Singapore being much smaller economically militarily politically then China is how does it manage China's anger there's a very real risk that Singapore might have to overcompensate and for example they might have to make more strident statements about the one China policy they might have to make statements calling on the US not to increase its relationship with Taiwan or calling on other ASEAN members not to do that so there's this risk of overcompensation in how Singapore handles the fallout from these bumps in the road with its China relationship interesting now your your firm gives the investment advice to prospective investors in Taiwan and in Hong Kong so what's your general advice to a prospective investor comes in and say well I have I don't know 50 million dollars whatever the amount and I like to invest in Taiwan what would your general advice be and I realize you probably need to talk about a specific industry but just generally what would your advice be well uh whether it's Taiwan or several other markets around the country we're all looking closely at what the new Trump administration policies will be most of the markets in Asia like Taiwan are very export dependent so we'd want to look at companies that could benefit from Trump administration policies for example companies in the infrastructure space that could supply infrastructure equipment giving the expectation that the Trump administration will be will be working with Congress to pass a very large infrastructure spending bill there certainly companies in Taiwan or Singapore other places around the region that might benefit from that uh that's a good point that's a good point we're down to about a minute and a half here uh what about investment advice for Hong Kong well Hong Kong is a services center there are financial industry and other industries here that benefit from Hong Kong's role in services uh hospitality for example tourism around the region uh so when looking at Hong Kong we also should look at the services sector more which would be more important than we were looking at other other markets around the region but but again a lot of this still comes back to the Trump administration policy so if there are companies in Hong Kong that benefit from the China-US trade then we'd want to evaluate what are the potential risks what are the changes in the China-US relationship and how would that impact companies in Hong Kong that are players in the US-China trade good advice but we if we want to invest in Hong Kong or Taiwan we know to go to your firm DC advisory um well we're just about at the end here it's been great having you with us today uh is there any last comment that you might want to add well certainly going forward as Trump administration as the Trump administration makes changes to Asia policy it's obviously very relevant to your audience in Hawaii starting with the military uh military families but but there's a lot of unknown so certainly bear close watching and certainly people in Hawaii who are closest geographically to the Asia-Pacific region will factor into US-Asia relations so it's a fascinating time and it's a great time to know for people in Hawaii to be following these issues closely and I look forward to being on your program to be talking about these issues in the future well Ross thank you very much for joining us today it looks like we're just about out of time thank you for joining us and we'll be seeing you soon thank you