Hong Kong is “one of three major financial centers” on the planet, and any damage to its status as a crucial center will have an effect on all the companies running there — consisting of foreign business, stated Hong Kong’s secretary for commerce and financial advancement.
Washington’s transfer to stimulate Hong Kong’s unique trading status with the U.S. was not “fair or justified,” Edward Yau informed CNBC on Tuesday.
He was describing President Donald Trump statement last Friday that he will end Hong Kong’s preferential trade status with the United States. It was available in action to China’s approval of a suggested security law that would efficiently bypass the legislature in the unique administrative area.
Critics of the questionable legislation state it will wear down the Chinese area’s flexibilities and autonomy.
Hong Kong’s autonomy
Separately, the U.S. passed a law in 2015 needing Hong Kong to be “sufficiently autonomous” from the mainland in order to receive a beneficial trading relationship with the U.S.
China’s proposition triggered issues over Hong Kong’s status as a leading monetary center in Asia, however Yau worried the value of the city to business from around the area.
“Hong Kong is … one of the three major financial centers around the world. Here, we trade globally in our time zone for all the stocks listed in Hong Kong. They (are) not only confined to Hong Kong companies,” he informed CNBC, including they consist of business from mainland China, Singapore and the U.S.
Many business develop their bases in the city as an entrance into mainland China, to East Asia and Southeast Asia, he mentioned.
There are issues that more than 1,300 American business running in the city would be affected if Hong Kong’s unique trade status with the U.S. were to be withdrawed.
Yau stated that both regional and abroad business remained in the services sector, where interests were linked.
“We welcome everybody to come do business here,” Yau stated , including that Hong Kong is serving a “very unique role … not just for the country, but also for the world.”
The variety of organisations running in Hong Kong that have moms and dad business beyond the city was 9,040 in 2015 –up almost 10% from 2017, according to information from InvestHK, a federal government company in Hong Kong. Those were primarily from mainland China, Japan, Singapore, the U.S. and the U.K.
Hong Kong hasn’t been “spared from the bigger … major geopolitical climate,” Yau stated. Even prior to the U.S. transfer to withdraw the city’s unique status, stress in between the U.S. and China were increasing, with the 2 contesting the origins of the coronavirus break out, for example.
Still, Yau included: “It doesn’t seem logical for a major trading partner (that’s) been investing in Hong Kong, taking full advantage of our trade balance and services sector, (to) do something meant to harm Hong Kong, and also simultaneously harming their own interests.”
He advised the U.S. federal government to reassess the choice and make “full calculations” on the effect of its carry on their particular economies, along with international markets.
Law does not ‘weaken or wear down’ rights
The brand-new law has actually likewise raised worries that flexibilities of Hong Kong, an unique administrative area of China, will continue to reduce. The city, a previous British nest that went back to Chinese guideline in 1997, is governed under the “one country, two systems” concept which is indicated to ensure a high degree of autonomy. It has its own judiciary, laws and currency.
But Yau on Tuesday offered guarantees that Hong Kong would continue to be independent, and would continue to practice the British-based typical law system.
“Let us make one thing very clear: the introduction of the national security law does not affect, undermine or erode any of the rights and privileges given to all citizens, entities and also companies — be they local or otherwise,” he worried.
“The national security law (is) there to protect not just territorial integrity, national security, but also the interests and stability of businesses,” Yau stated.