Hong Kong’s status as a financial center seems safe
Given its assault on democracy, imprisonment of publishers, and a slew of human rights violations, “stable” might not be the first word that springs to mind with respect to Hong Kong. But amid social and political turmoil, one key part of the economy has remained unfazed: its legendary financial services sector.
Why it matters: Beijing’s increasing control and influence over Hong Kong is seen by many banks and investors as more of a feature than a bug. While there are certainly downsides to staying, for the time being, the upside seems to be even greater.
- As Asia Group principal Kurt Tong wrote in a recent essay for Foreign Affairs, “Politics only narrowly affects the core incentives that guide financial and business decisions.”
The big picture: Hong Kong has been a gateway to mainland China for centuries. As China begins its crackdown on companies raising foreign capital and listing on…