VZCZCXRO7065
OO RUEHCN RUEHGH
DE RUEHHK #2587/01 1730942
ZNY CCCCC ZZH
O 220942Z JUN 06
FM AMCONSUL HONG KONG
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7406
INFO RUEHOO/CHINA POSTS COLLECTIVE PRIORITY
RHEHNSC/NSC WASHDC PRIORITY

C O N F I D E N T I A L SECTION 01 OF 02 HONG KONG 002587 
 
SIPDIS 
 
NOFORN 
SIPDIS 
 
DEPARTMENT FOR EAP AND EAP/CM 
NSC FOR DENNIS WILDER 
 
E.O. 12958: DECL: 06/22/2031 
TAGS: PGOV PREL PINR CH HK
SUBJECT: CPPCC CHAIRMAN JIA QINGLIN VISIT TO HONG KONG: 
CEREMONY OR SUBSTANCE? 
 
Classified By: E/P Section Chief Simon Schuchat; Reasons 1.4 (b, d) 
 
¶1. (C) Summary:  Chairman Jia Qinglin of the Chinese People's 
Political Consultative Conference (CPPCC) will visit Hong 
Kong June 27-29 to attend the "Mainland, Hong Kong and Macau 
Trade and Economic Cooperation Forum," which will mark the 
third anniversary of the signing of the Hong Kong-PRC Closer 
Economic Partnership Arrangement (CEPA).  During his visit, 
Jia also will meet with local political and business leaders 
and host a banquet to which all members of the Legislative 
Council (Legco) and Executive Council (Exco) have been 
invited, although many of the pro-democracy legislators are 
not likely to attend.  One independent democratic Legco 
member told us that the visit would constitute a very 
significant expression of support for Chief Executive Tsang, 
while an Exco member said we would need to examine whether 
Jia goes beyond "courteous words of support" to assess 
whether the visit represented explicit support for Tsang or 
just more general support for the HKSAR.  On the economic 
side, Trade and Industry Department Deputy Director General 
Raymond Young said Jia may use the occasion to unveil some 
expansion of CEPA preferences, although there were no plans 
for either a formal signing ceremony or a packaging of the 
measures into a "CEPA IV."  End Summary. 
 
¶2. (SBU) Chairman Jia Qinglin of the Chinese People's 
Political Consultative Conference (CPPCC) will lead a 
700-member delegation to Hong Kong June 27-29.  This will be 
the first official travel to Hong Kong by Jia, who ranks 
fourth in the PRC Politburo, since he was appointed CPPCC 
Chairman in 2003.  It also will be the first visit to Hong 
Kong by a high-level central government official since the 
December 2005 defeat of Chief Executive Donald Tsang's 
proposals for constitutional reform, which were supported by 
Beijing.  The last senior leader to visit Hong Kong was Vice 
President Zeng Qinghong in September 2005. 
 
CEPA Anniversary 
---------------- 
 
¶3. (SBU) During his visit, Jia will deliver the keynote 
speech at the opening of the "Mainland, Hong Kong and Macau 
Trade and Economic Cooperation Forum," which has been jointly 
organized by the Hong Kong Special Administrative Region 
Government (HKSARG) and the PRC Ministry of Commerce to mark 
the third anniversary of the signing of the Hong Kong-PRC 
Closer Economic Partnership Arrangement (CEPA).  Chief 
Executive Tsang, Macau Chief Executive  Edmund Ho, Minister 
of Commerce Bo Xilai, PRC Hong Kong Macau Affairs Office 
(HKMAO) Director Liao Hui, and other senior PRC officials are 
scheduled to attend the forum.  During his visit, Jia also is 
scheduled to visit the Hong Kong Stock Exchange, the Hong 
Kong Monetary Authority, a "middle-class family", the 
recently opened Wetland Park, and the Cyberport.  He also 
will hold closed-door meetings with local NPC and CPPCC 
delegates and meet with former Chief Executive Tung Chee-Hwa. 
 
 
Support for the Chief Executive? 
-------------------------------- 
 
¶4. (C) On June 28, Jia will host a banquet for Hong Kong 
business, community, and political leaders, including all 
members of the Executive Council (Exco) and the Legislative 
Council (Legco).  While most of the pro-Beijing legislators, 
including all ten Liberal Party members and most of the 
Democratic Alliance for the Betterment and Progress of Hong 
Kong (DAB) contingent, are expected to attend the banquet, 
independent democratic Legco member Albert Cheng told us on 
June 22 that the pro-democracy Democratic Party (DP) and 
Civic Party (CP) each would send just one or two members. 
Cheng said he and most of the other independents would find 
"excuses," such as an urgent Legco meeting to work on the 
pending covert surveillance legislation, to skip the event. 
The DP and CP are preparing a joint petition, urging 
acceleration of Hong Kong's democratic development and 
implementation of universal suffrage, for submission to Jia 
during his visit.  As usual, independent legislator "Long 
Hair" Leung Kwok-hung has vowed that he will stage a protest 
during the banquet. 
 
¶5. (C) Conversely to the democrats, some pro-Beijing groups 
in Hong Kong may seek to use the Jia visit to bolster their 
position as well as that of incumbent Chief Executive Tsang 
in the run-up to the December elections for the Election 
Committee that will select the next Chief Executive, widely 
expected to be Tsang, in March 2007.  Albert Cheng told us 
 
HONG KONG 00002587  002 OF 002 
 
 
that the visit constituted a very significant expression of 
support for Chief Executive Tsang and was "not just 
ceremonial."  Executive Council member Anthony Cheung was 
more circumspect, telling poloff on June 22 that we would 
need to examine whether Jia went beyond "courteous words of 
support" in order to assess whether the visit marked a 
reiteration of Beijing's backing for Tsang personally or just 
more general support for the HKSAR. 
 
Bearing Gifts from Beijing 
-------------------------- 
 
¶6. (SBU) For several weeks, rumors have been circulating in 
Hong Kong that Jia would unveil some "concessions" to boost 
the Hong Kong economy during his visit.  On June 20, Trade 
and Industry Department Deputy Director General Raymond Young 
said Jia might use the occasion of the third anniversary of 
the signing of CEPA, which is Hong Kong's free trade 
agreement with China, to roll out an expansion of CEPA 
preferences.  Young said that the legal, audiovisual, 
telecommunications, tourism, and construction sectors would 
all benefit from new market liberalization measures.  The 
details would be hammered out in a meeting between PRC 
Vice-Minister of Commerce Liao Xiaoqi and Financial Secretary 
Henry Tang early next week.  Young said there were no plans 
for either a formal signing ceremony or a packaging of the 
measures into a "CEPA IV."  This is in reference to the fact 
that to date, CEPA has been expanded in three distinct 
phases, the latest of which gave all products manufactured in 
Hong Kong tariff-free entry into the mainland. 
 
¶7. (SBU) The primary impact to date of CEPA has come from its 
tourism provisions, which committed the mainland to allow 
individual visits by some of its citizens to Hong Kong.  The 
ensuing expansion of the individual visitors program 
throughout cities in Guangdong and beyond has been a key 
element of Hong Kong's above-trend economic growth since the 
end of the SARS outbreak in the summer of 2003.  CEPA has 
also been credited with boosting Hong Kong's image in the 
eyes of foreign investors, with expanding opportunities in 
service sectors like banking and logistics, and with niche 
gains in manufacturing.  Taken together, CEPA is estimated to 
have created 30,000 jobs since it went into effect on January 
1, 2004. 
 
Cunningham