"Chinese pig" creates major problem for Swiss banking giant UBS

Financial services giant UBS dismissed chief economist Paul Donovan as he struggled to contain the fallout from his remarks about pork in China, which had caused the Indignation in the country.

A frequent comment in the financial media, Donovan sparked a public outcry during a discussion on consumer prices in China, which had risen because sick pigs had resulted in higher costs for pork. The situation mattered, he said, "if you are a Chinese pig, it is important if you like to eat pork in China".

Commentators of social media quickly condemned the first reference, interpreting it as a pejorative reference to the local population rather than sick pigs. Rival brokerage firms in Hong Kong intervened, urging the bank to fire everyone involved in the incident.

The Swiss bank is studying the issue and is assessing whether further action needs to be taken, a spokesman said via e-mail. Shares of the world's largest wealth manager fell for the second day as Donovan's comments continued to impact China, a key market for his plans to attract more money from wealthy Asians.

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The stakes are high for UBS, which has been in China for longer than most Wall Street companies, and was the first foreign company to gain majority approval in a local securities firm for the first time. the country's recent financial opening campaign. While most wealth managers still serve wealthy Chinese from offshore centers such as Hong Kong and Singapore, the country's huge onshore fundraising, estimated at around US $ 20 trillion, is a holy grail for the area.

The bank and Donovan quickly apologized for the comment, saying his intention was "innocent". UBS, which hired more senior executives within the joint venture, removed it from circulation.

"I made a mistake and I unconsciously used an extremely culturally insensitive language," Donovan said in an interview with Francine Lacqua by Bloomberg TV, recalling that his remarks were not intended to to offend. "I publicly apologize for that."

Donovan refused Friday to comment on his departure. the Financial Times had already reported on the decision of UBS.

Donovan is known for his analysis of central banks and economic indicators and has studied the economics of diversity. In a 2018 report, he and his colleagues concluded that "a country or a disadvantaged business can not be economically important" and that "diversity means better decision making and better economic outcomes". His Twitter page boasts "the economy without jargon, but with sarcasm".

The escalation comes at a time when tensions in China are already high and hundreds of thousands of protesters have rallied in Hong Kong against an extradition law, as the United States escalates its threats to increase tariffs.

Jack Ma, whose rise from the English professor to the richest man in China helped to make the rich capitalists acceptable in the communist country, predicted that tariffs might be just the beginning of a commercial war that can last 20 years.

Local UBS rivals, who were attempting to take a larger share of a business dominated by well-established Western wealth managers, quickly condemned Donovan's remarks. The Hong Kong Securities Association of China, a group that represents financial institutions, including branches of Hong Kong-based companies in Hong Kong, has asked for further dismissals and excuses.

Haitong International Securities announced Friday that it has suspended its activities with UBS. The company's general manager, Lin Yong, is also chairman of the Chinese Securities Association of Hong Kong. A spokesperson did not provide information on the business volume of her business with UBS.

L & # 39; s state-run Global Times tweeted "In a recent report from UBS, Paul Donovan, chief economist at UBS, used racist and disgusting language to analyze Chinese inflation."

UBS fell 2.1% in trading in Zurich, extending the 0.6% decline recorded on Thursday.

Trade tensions, in particular, have exacerbated sensitivities in China as a number of western societies have recently been forced to repair.

Last year, Dolce & Gabbana postponed a parade in Shanghai after a series of videos featuring a Chinese mannequin trying awkwardly to eat cannoli, pizza and other Italian dishes with indignant chopsticks. The messages of Stefano Gabbana, co-founder, insulting the Chinese people and defending the video caused a storm of fire on social networks.

Mercedes is apologetic after quoting the Dalai Lama – the Tibetan spiritual leader perceived as a threat by Beijing – in a China-based Instagram post. Gap has released a t-shirt depicting a map of China leaving aside the territories claimed by Beijing.

"We apologize without reservation for any misunderstanding caused by these innocent comments," UBS said in a statement. "To be clear, this comment related to inflation and rising consumer prices in China, driven by higher prices for pork."