Hong Kong companies are facing a “new normalcy” as the city faces challenges on multiple fronts, according to the president of the Hong Kong American Chamber of Commerce.
The current Covid-19 crisis, along with the recent passage of the national security law and troubled trade relations between the United States and China, are among the main concerns of companies headquartered in the Asian financial center, he said. said Tara Joseph on CNBC’s “Street Signs Asia” on Thursday.
“Hong Kong has experienced a new normalcy in the last two years. We are dealing with Covid. We have a lot of changes in terms of Hong Kong being at a political turning point,” he said, referring to the new security law. national China approved by Hong Kong last year and the revision of his electoral system last month. The changes could further reduce the city’s freedoms, critics say.
Joseph added that these factors were further complicated by the friction between China and the United States, in terms of trade and politics. “All of these items are at the top of the business list here,” he said.
Let’s take sanctions, for example, against the United States and China. These add up to the risk of being here.
Tara Joseph
president of the American Chamber of Commerce in Hong Kong
The two largest economies in the world signed a first-phase trade agreement in January, which eased tensions over the past two years.
Although the Biden administration has promised to use “all available tools” to counter China’s unfair trade practices, it has not yet made clear its position on how it will handle tariffs with China that have hurt the two companies. countries.
“Let’s take sanctions, for example, against the United States and China. These add to the risk of being here,” Joseph noted. He said Hong Kong companies are “rethinking themselves, potentially they can also re-evaluate and measure risk here.”
Travel problems
Although Hong Kong has been able to contain the Covid-19 pandemic, Joseph argued that restrictive city travel and strict quarantine measures have caused companies to re-evaluate their long-term presence in the city.
“The Covid issue and quarantine bring it down to a personal level,” he said. Those living in Hong Kong have not been able to visit their families and “this is starting to become a personal concern.”
Philippe Lopez | AFP | Getty Images
“This is where we see people start to wonder how long they can stay here. And if being here it will be effective for them in the long run,” Joseph said.
And that could hurt Hong Kong’s reputation as a global financial center.
“Hong Kong is also seen as a place where you connect to travel, where you can have freedom of movement. And if we can’t do that, it will affect the city’s competitiveness. So it’s a growing concern,” Joseph noted.