Asian Insider, June 1: China slams US hypocrisy, S’poreans don’t have enough savings, and Australian universities want their foreign students back

Asian Insider brings you insights into a fast-changing region from our network of correspondents.

Hi all,

In today’s bulletin: China warns America and orders state-run firms to stop buying US farm goods, Filipinos are being paid to move out of the capital, Australia’s universities are planning “safe corridors” for foreign students, and a poll finds that most Singaporeans don’t have enough savings to last them beyond half a year.

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CHINA SLAMS US OVER HONG KONG CRITICISM, HYPOCRISY; STOCKS RISE

China warned on Monday (June 1) that America’s bids to hurt Chinese interests would be firmly countered, as it slammed US moves to end its preferential treatment of Hong Kong and act against Chinese students and firms. China’s major state-run agricultural firms were told to stop buying some US farm goods, including soybeans and pork, threatening a hard-won phase-one trade deal between the world’s two biggest economies. 

The latest development in the escalation of Sino-US tensions did not deter investors, however, who on the first day of the new month boosted Asian equities and propelled Hong Kong stocks to their best day in more than two months. The risk-on sentiment came after US President Donald Trump last Friday stopped short of specifying tough sanctions against China for imposing new national security laws on Hong Kong. 

But the legislation has spurred many Hong Kong residents to dash for the exit, with migration consultants reporting a marked jump in inquiries and applications for good citizenship cards required for foreign visas. Britain said it would offer a path to citizenship to the three million Hong Kong residents who hold British National (Overseas) passports, as the US government put up for sale luxury property worth up to HK$10 billion (S$1.8 billion) in the city’s exclusive Shouson Hill neighbourhood. 

Meanwhile, America’s clampdown on its own protests over the death of an unarmed black man in Minneapolis, drew criticism from Chinese officials, media and internet users alike. They pointed out hypocrisy on the part of Washington, which had earlier lambasted Beijing’s handling of the social unrest in Hong Kong. But Beijing’s stoking of growing nationalistic sentiment in China could backfire in the long run, Hong Kong-based political analyst Willy Lam tells China correspondent Danson Cheong. 

Delve deeper: 

Trump's options to hit Hong Kong, from tariffs to China's banks 

US lawmakers to unveil bill banning investment in firms tied to China's military

Read our news analysis by global affairs correspondent Benjamin Kang Lim and China bureau chief Tan Dawn Wei: 

Fear of foreign interference looms large in China's version of Hong Kong law

DUTERTE’S PAYING FILIPINOS TO MOVE FROM CITY TO COUNTRYSIDE

The coronavirus pandemic has given the Philippines a reason to resolve its capital’s overcrowding problem. President Rodrigo Duterte is now paying city-dwellers to move out of the greater capital region to the countryside to reduce the strain on Manila’s overstretched transport, utility and healthcare systems. The “Back to the Province” programme offers families up to 110,000 pesos (S$3,000) in cash and goods to relocate. 

More than 2 million jobs have already been lost in the Philippines, a third of them in Manila, the epicentre of the country’s coronavirus outbreak. Life in the densely packed capital has become far less appealing, with Philippines’ unemployment rate expected to reach double digits. Some 60,000 people have already applied for the relocation programme, but the biggest challenge would be for them to find sustainable work in the countryside and to stay there even after the economy recovers from what will likely be its deepest contraction in three decades. Millions of Filipinos returned to work in Manila on Monday as its lockdown - one of the world’s longest and strictest - was eased.

India is also preparing to reopen this month despite a record rise in new coronavirus cases. State governments are rushing to identify high-risk zones where lockdowns will continue until June 30, but elsewhere, malls, restaurants and religious buildings will be allowed to reopen for operations from June 8.

AUSTRALIAN UNIS PLAN ‘SAFE CORRIDORS’ FOR FOREIGN STUDENTS

Australian universities are pushing a plan to create “safe corridors” to let foreign students return, as the country tries urgently to save its lucrative international education sector badly hit by the coronavirus pandemic, Jonathan Pearlman writes. The proposal - from a group representing eight of Australia’s leading universities - would allow students to enter from countries that have their outbreaks under control. The federal government has signalled that it will consider exempting international students from the coronavirus travel curbs in July. 

International students bring A$39 billion (S$37 billion) into Australia each year and account for 26 per cent of total university revenue. But the travel curbs have kept 120,000 such students - or 20 per cent of the total cohort - away from their studies so far; a further 80,000 were due to commence their second semester studies from next month. The loss of foreign students has put 21,000 jobs at risk, with universities facing losses of up to S$4.6 billion. 

Australia is intensifying efforts to revive its ailing economy, now that its coronavirus situation has stabilised. Several states further eased social distancing restrictions on Monday, allowing more diners in restaurants and public attractions to reopen for business. More targeted stimulus is still needed to prop up the economy, Prime Minister Scott Morrison said.

Related: Australia home prices fall as Covid-19 shutdowns hit property market

TWO IN THREE S’POREANS’ SAVINGS CAN’T LAST THEM BEYOND SIX MONTHS

Two in three working Singaporeans and permanent residents among 1,000 polled, do not have enough savings to last them beyond six months, according to an OCBC survey aimed at gauging the financial impact of the coronavirus pandemic on working adults in Singapore. The bank polled people aged 21 to 65 who earn at least S$2,000 a month. 

About half of the respondents have already suffered pay cuts, commission reductions or been told to go on no-pay leave due to the coronavirus crisis. One in five have seen their savings drop more than 20 per cent, but one in four said they had managed to save more. 

Retirement and investment plans have also been affected. A third of those aged 40 to 54 have cut their retirement savings, while about a quarter of those in their 20s with a financial plan have put aside more money for retirement. Two in five of those polled plan to downsize their investment portfolios, with 16 per cent intending to make cuts of more than 20 per cent. 

The survey provides insight to some of Singaporean working adults’ most pressing concerns. While more than half are currently worried about their income and job security, fewer of the respondents expect to be troubled by the same issues by December.

On a related note, saving more is now less rewarding as interest rates fall: 

OCBC cuts salary credit bonus interest on 360 account from July 1

THAI RULING PARTY SEES MASS RESIGNATIONS; TOURISM HITS ZERO

The Thai ruling coalition’s biggest party has been hit by a wave of resignations from its executive members amid talk of internal strife, Indochina bureau chief Tan Hui Yee writes. Eighteen of Palang Pracharath Party’s 34 executive members have quit the board, paving the way for internal elections to pick new executives and a party leader -- with the changes expected to eventually lead to a Cabinet reshuffle.

Meanwhile, Thailand’s Tourism Ministry said the country received no foreign tourists or related spending in April, in the first such report to slump to zero in data compiled by Bloomberg stretching back to the 1990s. Before the coronavirus pandemic, tourism accounted for a fifth of Thailand’s gross domestic product, with Chinese visitors its biggest source of foreign income. The Thai economy is set for its worst contraction in two decades. Incoming international flights are banned until June 30.

IN OTHER NEWS

KL-SINGAPORE HIGH-SPEED RAIL PROJECT TO STAY HALTED TILL DEC 31: Singapore has agreed to further suspend the high-speed rail (HSR) project that would link it with Kuala Lumpur until the end of the year, at Malaysia’s request. The extension should give Malaysia more time to clarify its proposed changes to the project and for both sides to assess the implications of those changes, Transport Minister Khaw Boon Wan said. 

INDIA EXPELS PAKISTAN ENVOYS FOR SPYING: Two officials at the Pakistan High Commission in New Delhi have been expelled for “indulging in espionage activities”, India’s foreign ministry said amid heightened tensions between the two countries. The South Asian neighbours have a long-running dispute over Kashmir, which was split between them in 1947. 

SOUTH KOREA’S EXPERIMENTAL COVID-19 TREATMENT SHOWS RESULTS: South Korean pharmaceutical Celltrion Inc says its experimental coronavirus treatment has shown a 100-fold reduction in viral load of the deadly disease in animal testing. Its pre-clinical study was conducted with ferrets and will be expanded to hamsters, mice and monkeys before clinical trials. 

That’s it for today. Thank you for reading, stay safe, and we’ll be back with more insightful articles for you tomorrow. 

Magdalene