Beijing’s tough treatment of foreign companies, with its use of exit bans targeting bankers and executives, has unnerved multinational businesses, according to the Wall Street Journal.
The newspaper reports that international companies, including banks, investment firms and technology companies, are now beating a retreat from Hong Kong.
Last year mainland Chinese companies with regional headquarters in Hong Kong outnumbered American ones for the first time in at least three decades. Now Singapore is looking to benefit from the change.
The Wall Street Journal quotes research and publishing company executive Simon Cartledge as saying that coming to Hong Kong used to be ‘a fairly risk-free matter. Now, it’s not a risk-free place. There are question marks over everything.’
For years after the UK returned Hong Kong to China in 1997, Hong Kong appealed to foreign companies by being close to China, but not too close.
That changed after Hong Kong’s tighter national-security restrictions, Beijing’s crackdown on foreign businesses, an economic slowdown in the mainland, and growing tension between the US and China.
In a written statement, a spokesperson for the Hong Kong government said that Hong Kong ‘remains one of the most business-friendly places in the world’ and is ‘home to around 9 000 mainland and overseas companies’.
Yet, according to the newspaper, that number, combining Chinese and foreign businesses, has remained stable over the past five years. The city’s property market is in a slump.
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