HK newspaper says banks pulled ads

18-Jun-2014 Intellasia | Marketwatch | 6:00 AM Print This Post

HSBC Holdings PLC and Standard Chartered PLC have pulled millions of dollars worth of advertising from Apple Daily, a popular Hong Kong newspaper known for its tendency to criticise China, because of pressure from Beijing, an executive at the media company said.

Mark Simon, a commercial director at Next Media Ltd, publisher of the Apple Daily, said the two banks stopped advertising in the newspaper in late 2013 after being asked to do so by China’s government.

Apple Daily is one of Hong Kong’s biggest-selling newspapers, with daily sales of 195,941 in the six months to the end of 2013, according to the Hong Kong Audit Bureau of Circulations Ltd

“They were large advertisers with us for a long time,” Simon said of HSBC and Standard Chartered. He first began to air his complaints in local media earlier this year, but the advertisements remain on ice.

“We’ve had long relationships with these guys, and then it fell apart.”

According to Simon, who was speaking after media reports of the newspaper’s loss of advertising, the two banks together bought about $3.6 million worth of ads in 2013. It wasn’t immediately clear how much in total advertising that spending amounted to.

The trigger, Simon said, was Next Media’s continuing coverage of protests against China’s creeping influence in Hong Kong, which had been promised significant autonomy by Beijing after the British government handed back its former colony in 1997.

Next Media was founded by Hong Kong’s multimillionaire media magnate, Jimmy Lai, who is known as an outspoken critic of China’s top leadership.

Representatives for HSBC and Standard Chartered said the decision to stop placing advertisements with Apple Daily was made on commercial grounds.

“It is purely a commercial decision. We do review our advertising strategy from time to time in order to ensure that we can achieve the maximum impact in promoting our business,” said Gabriel Kwan, a spokeswoman for Standard Chartered.

Gareth Hewett, a spokesman for HSBC, said “the bank’s selection of marketing format and channel is (commercially) linked to target market and customer segment.”

Hong Kong is home to dozens of newspapers and news websites, offering companies an array of options to place their advertisements.

For banks such as HSBC and Standard Chartered and others based in Hong Kong, China is a booming market for loans where cash-hungry corporates facing tight credit are seeking out cheaper loans offshore. Chinese companies have been borrowing heavily from Hong Kong, as Beijing seeks to clamp down on the flow of domestic credit. Hong Kong alone accounted for about a third of HSBC’s and Standard Chartered’s pre-tax profits last year.

The two banks, and especially HSBC and its Hang Seng Bank unit, also have a big presence in China. HSBC is the biggest foreign bank in China by assets.

An official at the Chinese government’s liaison office in Hong Kong who declined to be named denied the allegation from Apple Daily, saying “we never had any contact with these two banks.”

Apple Daily has drawn support from influential figures in the former British colony. Anson Chan, who once served as Chief Secretary for Administration, a top government post, has written letters to the banks asking for an explanation as to why the advertising has stopped. The banks’ responses, which were reviewed by The Wall Street Journal, don’t deal directly with Apple Daily’s allegations.

“It would send a very bad signal about Hong Kong’s press freedom and the lack of it,” Lau said.

Tensions between the mainland and Hong Kong have been on the rise leading into 2017, the earliest year Beijing has said the city may directly elect its leader. Activists have threatened to shut down Hong Kong’s financial district in a civil-disobedience campaign called Occupy Central to demand universal suffrage, free from Beijing’s intervention. At the moment, Hong Kong’s chief executive is chosen by a 1,200-member committee composed largely of pro-Beijing and business camps.

On June 4, tens of thousands of people in Hong Kong held a candlelight vigil commemorating the 25th anniversary of the Tiananmen Square crackdown. And on June 22, the Occupy Central protest group will hold an informal citywide poll asking the people of Hong Kong to vote for their preferred electoral change.


Category: Hong Kong

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