Yahoo Finance on 1.7.2020 reported the following:
What Hong Kong’s New Security Law Means for Business
Bloomberg Bloomberg News,Bloomberg 12 hours ago
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(Bloomberg) -- After more than five weeks of waiting, the business world is getting its first real look at the controversial national security law that will shape Hong Kong’s future as a financial hub.
Big questions still remain about how China’s Communist Party will wield its new powers in the former British colony, but the law’s public unveiling on Tuesday provides some clues. Here are some early takeaways from investors, bankers, economists and business leaders:
No big surprises for markets; short-term moves in stocks, the yuan and Hong Kong’s dollar will depend on the U.S. response. Hong Kong equities will continue to get support from Chinese buyers. Over the long term, the risk premium for Hong Kong assets will likely rise, resulting in depressed valuations and potential capital outflows. Continued uncertainty over the law’s implementation, the response by protesters, and retaliation from the Trump administration may restrain Hong Kong’s economic recovery. International companies using Hong Kong as an Asia hub will become more reluctant to engage in local politics and may hedge their exposure to the city. Firms that store data in Hong Kong will increasingly look for alternatives
The comments below, from people with capital and livelihoods
at stake in Hong Kong, have been lightly edited and condensed.
Michael Tien, a member of Hong Kong’s Legislative Council and founder of fashion retailer G2000 Apparel Ltd.
The central government is telling us to just stay out of politics. Build the economy, innovate, build up livelihoods, build bigger flats for people to live in, add more land, but stay away from politics. We can still criticize the government, but probably on livelihood issues, infrastructure projects, how they do on quality of life. In terms of freedom of speech, that is something that is very much on peoples’ minds. I don’t think they’re going to use the law indiscriminately. I do believe they’re going to use it in very rare occasions.
Jes Staley, chief executive officer of Barclays Plc
I’m not going to get involved in the politics. Clearly, we support all of our colleagues and clients across Asia and in China and in Hong Kong. It’s a very difficult political situation. We’ve not made a statement, we’re not going to make a statement. We’re a major British bank. We need to be very cognizant of what’s going on in the U.K. and the position taken by the U.K. government. But we’re not going to get involved in the politics of Hong Kong.
Jun Bei Liu, portfolio manager at Tribeca Investment Partners in Sydney
I do feel this will add to the complexity of working in Hong Kong or operating out of Hong Kong. As an investor, what you do with all this complexity is to add a bit more of a risk premium when it comes to that market. Longer term, it could be possible you see more international firms and investors based out of Asian markets instead of Hong Kong being the central hub.
But I think Hong Kong is still very, very relevant and it is the hub to have access to China, which is an enormous market. We attend conferences in Hong Kong almost annually, except this year. We want to see and feel all the companies over there. I don’t think that will go away.
Law Ka-chung, adjunct professor at City University of Hong Kong and former Bank of Communications (Hong Kong) economist who said he was asked to leave the role in part due to his views on the impact of Hong Kong’s protests
It is not only about the law itself. It is more about how the world sees “two systems.” Now the world believes there is only “one system”, and that Hong Kong is no longer a free capitalism market. That will accelerate capital outflow and foreign capital flight.
Investment aside, doing business through Hong Kong is also going to be hit hard, with the U.S., EU, India, Japan, Australia and many countries seeking to “de-China.” Hong Kong used to be the springboard for them to eventually go into China and provided financial services in-between. This formula no longer works.
Charles Mok, a member of Hong Kong’s Legislative Council who represents the information technology industry
The feeling is that, all of a sudden, the one country, two systems arrangement has disappeared and Hong Kong is truly just another part of China. What the U.S. is doing in response right now is inevitable because they would be worried about the technology being transferred into China or falling into the wrong hands. It will definitely impact our research and development efforts, including even civilian or academic research.
Investment from international companies in Hong Kong for data centers and network infrastructure and so on will be hampered. Fintech companies or other kinds of technology companies will really worry about the future for Hong Kong and whether or not they might have to consider moving some of the operations to other parts of the world. It’s ironic that passing this national security law may make the international community feel that Hong Kong is less secure.
Michael Hsia, who sells cash equities at Vantage Capital in Hong Kong
For investors, it means that there is clarity to the situation. Although this might not sound like a positive in terms of how a westerner or outsider views this law, it at least addresses how China will deal with the situation and that the stability of the city is paramount. For companies it will also be similar too, in that they can operate knowing that their security will be solid.
It will be criticized as some kind of suppression to freedom, yet at least it brings about some level of stability that was once totally taken for granted in Hong Kong.
(to be continued)
Translation
（彭博社）- 經過五個多星期的等待，商業界開始對有爭議的國家安全法進行首次真正的審視，該法將影響香港作為金融中心的未來。
關於中國共產黨將如何在前英國殖民地行使新權力，仍然存在重大疑問，但法律在周二的公開揭幕中提供了一些線索。以下是投資者，銀行家，經濟學家和商業領袖的一些早期收穫：
市場沒有大的驚愕；股票，人民幣和港元的短期走勢將取決於美國的反應。香港股票將繼續獲得中國買家的支持。從長遠來看，香港資產的風險額可能會上升，從而導致估值下降和潛在的資本外流。有關法律實施的持續不確定性，抗議者的回應以及特朗普政府的報復行動可能會限製香港的經濟復甦。以香港為亞洲樞紐的國際公司將更不願參與當地政治，並可能對沖他們對這座城市的接觸。在香港存儲數據的公司將越來越多將尋找替代方案
下面的評論來自於那些在香港的資本和生計受到威脅的人，這些評論經過輕度編輯和精簡。
田北俊（Michael Tien），香港立法會議員，時尚零售商G2000 Apparel Ltd的創始人
中央政府告訴我們不要參與政治。去建立經濟，去創新，建立生計，建造更大的公寓供人們居住，增加土地，但遠離政治。我們仍然可以批評政府，但可能只可以在民生問題，基礎設施項目，批評政府如何改善生活質量。就言論自由而言，這在人們心目中是非常重要的。我認為政府不會任意使用法律。我確實相信他們會在極少數情況下使用它。
Barclays Plc首席執行官Jes Staley
我不會參與政治。顯然，我們為亞洲，中國大陸和香港的所有同事和客戶提供支援。這是一個非常困難的政治局勢。我們尚未發表聲明，也不會發表聲明。我們是一家主要的英國銀行。我們需要非常了解英國的情況以及英國政府的立場。但是我們不會介入香港的政治。
Tribeca Investment Partners悉尼投資組合經理Jun Jun Liu
我確實認為這將增加在香港工作或在香港以外地區經營的複雜性。作為投資者，要處理所有這些複雜性經營就是會增加涉及該市場的風險額。從長遠來看，您可能會看到更多的國際公司和投資者建基於亞洲市場，而不是以香港為中心樞紐。
但我認為香港仍然非常重要，它是進入中國的樞紐，中國是一個巨大的市場。除了今年，我們幾乎每年都在香港參加會議。我們希望看到並感受到在那裡的所有公司。我認為那不會消失。
香港城市大學兼任教授，前交通銀行（香港）經濟學家羅家聰，他曾說他之所以被要求辭職，部分原因是他對香港抗議活動的影響有自己的見解
這不僅與法律本身有關。它更多地是關於世界如何看待“兩個制度”。現在，世界相信只有一個制度，而香港不再是自由的資本主義市場。這將加速資本外流和外國資本外逃。
除了投資，通過香港開展的業務也將受到重創，因美國，歐盟，印度，日本，澳大利亞和許多國家都尋求“中國化”。香港曾經是他們最終進入中國並在其間提供金融服務的跳板。此公式不再起作用。
莫乃光，香港立法會議員，代表資訊科技業
感覺是，一個國家，兩個制度的安排突然消失了，香港確實只是中國的另一部分。美國現在做出的回應是不可避免的，因為他們會擔心該技術被轉移到中國或落入不正確的人手中。這肯定會影響我們的研發工作，甚至包括民用或學術研究。
國際公司在香港對數據中心和網絡基礎設施等的投資將受到限制。金融科技公司或其他類型的科技公司將真的擔心香港的未來，以及是否必須考慮將部分業務轉移到世界其他地方。 具有諷刺意味的是，通過這項國家安全法可能會使國際社會感到香港不甚安全。
邁克爾·夏（Michael Hsia），他在香港Vantage Capital経營現金股票
對於投資者而言，這意味著情況明確化。儘管就西方人或局外人看待這法律而言，似乎不是一個積極的方法，但它至少解決了中國將如何處理這種情況，而城市的穩定性至關重要。對於公司而言，這也將是相似的，因為他們知道他們是可以安全實在地營運。
人們會批評它是對自由的某種壓制，但至少帶來了某種程度的穩定，而這種穩定曾經在香港完全被設定為是理所當然的。
(待續)
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