UK bank expands in China amid diplomatic row

By Wang Cong and Yin Yeping Source: Global Times Published: 2020/7/20 20:53:40

New investment shows resolute opening-up despite tensions

A Guangzhou citizen takes a photo of the Guangdong-Hong Kong-Macao Greater Bay Area cuisine display at the World Cuisine Collection. Photo: Li Jieyi/GT

UK-based bank Standard Chartered Plc announced Monday that it would open a $40 million center in South China's Guangdong Province in what the company says is a move to support the Guangdong-Hong Kong-Macao Greater Bay Area development plan at a time when China-UK ties have soured over London's moves on Hong Kong and Huawei.

Under the plan, Standard Chartered will launch the center for individual and enterprise services in the third quarter of 2020, and will employ as many as 1,600 staff by 2023, according to a statement the company sent to the Global Times Monday. 

"Standard Chartered has listed the Guangdong-Hong Kong-Macao Greater Bay Area as core region of strategic focus and will utilize our talent, technologies and deep understanding of customers in rolling out innovative products and services to support the development of the Greater Bay Area," Bill Winters, chief executive of Standard Chartered, said in a statement in Chinese.

The announcement came at a delicate time for the China-UK bilateral relationship, which has significantly deteriorated after a couple of recent moves made by the UK that angered Beijing. 

In what Chinese officials call a political decision at the behest of the US, London last week issued a ban on Chinese telecom firm Huawei's 5G equipment and technology. 

The UK's recent move to pave the way for certain Hong Kong residents to obtain residency and citizenship following the implementation of the National Security Law for Hong Kong also sparked fierce backlash from Beijing, with officials calling it gross interference in China's internal affairs.   

"Standard Chartered has been laying out the move for quite a while and all it needed was the timing to make the announcement," Liang Haiming, chairman of the China Silk Road iValley Research Institute who also studies the development of the Greater Bay Area, told the Global Times Monday. "Other foreign financial institutions will follow suit."

In wake of the Huawei ban last week, Chinese officials have vowed to take "all necessary" measures to protect Chinese businesses. Though there still has been no countermeasures announced, the dramatic turn of events has sent chilling waves through UK businesses over possible retaliation. 

Some Chinese experts have warned that certain UK businesses could get caught in the diplomatic crossfire, particularly UK bank HSBC, which has been bombarded for its role in helping US crack down on Huawei.

Still, analysts argue that foreign companies like Standard Chartered's move into the Greater Bay Area because of the massive potential for business in the region, given the slew of policy support offered by the Chinese government, and China's commitment to further open up its domestic market for foreign investors. 

"The future development of the Greater Bay Area is promising because it is an important region for high-quality growth in China and its development is in line with the government's spirit to boost economic growth in the region," Ding Li, director of the Regional and Enterprise Competitiveness Research Center at the Guangdong Academy of Social Sciences, told the Global Times on Monday.

In May, China released a guideline for financial reform and innovation in the Greater Bay Area, including expanding the opening-up for foreign financial institutions. 

"Especially under the current anti-globalization tide, China will continue to expand and accelerate financial opening regardless of the relationship with the US or the UK… under this backdrop and with the implementation of the National Security Law for Hong Kong, more foreign companies will continue to invest in the Greater Bay Area," Liang said.

Posted in: COMPANIES

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