Hong Kong’s new National Security Law has raised fears that the city will lose its allure as a global financial hub. During an IMA Asia meeting in Shanghai, one member suggested
‘We often think of Hong Kong as a global hub or a regional hub for business. That's not Hong Kong. Hong Kong is no more than the smallest of the tier one cities in China. Hong Kong is a tier one city, but it's the smallest one.’
Hong Kong’s reputation has taken a hit.
‘It’s become tougher to attract international talent to Hong Kong. A lot of jobs require Mandarin. People are worried about how a revised “one country, two systems” will affect them and their company.’
While the legislation and reputational worries trouble some executives, others see Hong Kong as a robust financial hub with a promising future.
‘Hong Kong is the only financial centre in China – 71% of RMB SWIFT payments are passing through Hong Kong.’
‘A de-risking exercise, in which treasuries are coming into the market, is propelling Hong Kong’s comeback in the financial sector. Hong Kong is a transparent market where regulations are enforced. I have a positive view of Hong Kong’s future.’
Many foreign executives based in Hong Kong remain bullish on the territory.
‘Hong Kong is 60% of our revenue. Singapore is only about one tenth of the size. In Thailand, we’ve had two large projects. But you never know when the next one will happen, or whether it will get canceled. In Malaysia, we’ve been talking about an investment for three years, but the government could stop that. Vietnam’s been in the doldrums for 18 months. There’s no predictability with these markets.’
The bottom line...
‘In Hong Kong, personalities change but it’s still basically the same government. There are consistencies and continuities.’
Our report ‘The Future of Hong Kong as a Regional Headquarters’ holds valuable insights about Hong Kong’s future.
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