Chairman of the American Chamber of Commerce in Hong Kong, Robert Grieves, spoke to finews.asia about how Beijing’s recently proposed national security legislation could impact the financial industry and expat workers in the city.
In your recent statement, you underlined the strong governance as a key reason for the success of Hong Kong’s financial hub. In the event this is compromised, how would investors and asset owners respond?
Hong Kong relies on the strength of its regulatory governance, particularly its Securities and Futures Commission, to maintain a strong financial services sector bolstered by the third-largest stock exchange in the world. Once that regulation is weakened, either in perception or in actuality, investors and asset owners will begin to flee to safer havens beyond Hong Kong’s shores.
How will this affect Hong Kong’s status as a global financial hub?
As of now, the Hong Kong Stock Exchange is the gateway through which international investors can access China, and Chinese investors can access international markets. If trust in that gateway is broken, faith in Hong Kong as a premier financial center will begin to decline.
One of the unique factors that distinguish Hong Kong from mainland China is the free flow of information. How important is this for the financial industry especially with regards to research?
The free flow of information is essential to delivering effective research to investors. In the absence of verifiable information, sound investment decisions cannot be made. Reliable, verifiable information, available to all, is as important to research independence as transparency is to financial markets and exchanges.
In light of Beijing’s recent proposal for a Hong Kong national security legislation, what are the main concerns for foreign talents residing in the city?
For expatriates in general, bankers and non-bankers alike, the lack of detail and specificity around the proposed legislation is most troubling. That, and the fact that the legislation is coming from Beijing and bypassing the Hong Kong legislature.
Any unique concerns from bankers in light of potential U.S. sanctions in response to legislation in Beijing?
Because so much is not yet known about the new legislation, including specific sanctions against financial institutions, bankers are adopting a wait and see attitude.
What does Hong Kong’s banking sector stand to lose in the event of materially reduced interest from international talent? Does talent diversity matter?
In a business, financial and trading hub such as Hong Kong, international talent is very important. Local and mainland Chinese talent is more accomplished than ever before, but it is the mix of different ideas and practices that international talent brings from other jurisdictions to mix with local talent that makes Hong Kong what it is today. The future of banking, as well as tech and healthcare, depends on this mix of talent.