HK’s COVID-19 battle won’t undermine its financial hub status
Published: Jun 27, 2022 10:13 PM
Illustration: Chen Xia/Global Times

Illustration: Chen Xia/Global Times

Several days before Hong Kong celebrates the 25th anniversary of its return to the motherland on July 1, some Western media outlets are looking to find new ways to vilify the Hong Kong economy. A Wall Street Journal (WSJ) report, titled "Hong Kong's struggle to lure bankers dims its role as a global finance hub," alleged the city's reputation continues to suffer as COVID-19 control measures "drive away" international bankers and investors.

It is neither the first time, and unlikely to be the last time that Western media runs reports claiming the city is at risk of losing its status as a global financial hub. 

Since Hong Kong's return to the motherland in 1997, whenever there are short-term economic fluctuations, the rhetoric of "losing its financial hub position" has always popped up. It is not difficult to find that such rhetoric resonated to a large extent with the malicious slander by the Western media against the Chinese economy.

Despite challenges brought about by the COVID-19 pandemic, Hong Kong secured third place in the latest Global Financial Centers Index, remaining among the top in areas including business environment, human capital, infrastructure and general reputation,  Xinhua News Agency reported on June 19, citing the index compiled by British think tank Z/Yen Group and the China Development Institute in Shenzhen. 

The IMF in March claimed that the financial system of the Hong Kong Special Administrative Region (SAR) has continued expanding robustly even during the pandemic while "maintaining its role as a major international financial center." This added to evidence that Hong Kong's status as a world financial hub has remained stable, or has even been enhanced over the past years.

There is no denying that recent COVID-19 resurgence has caused some economic headwinds. Hong Kong's economy contracted 4 percent in the first quarter from the same period last year. However, the city's efforts to fight the pandemic can only be deemed as a short-term factor causing some difficulties in the economy, and we believe the city will ultimately overcome those challenges. Some economists have forecast that Hong Kong's economy will resume positive growth in the second half this year.

The unique advantages of Hong Kong in facilitating international and Chinese mainland capital are a powerful driving force for the SAR's long-term stability and prosperity. As the economic links between Hong Kong SAR and the Chinese mainland have continued to expand and as the mainland's own economy has grown considerably, Hong Kong's economy has positive momentum to keep growing in the long run. With its robust legal systems and simple tax system, Hong Kong offers a dynamic and secure place to do business.

Hong Kong is a global leading initial public offering (IPO) venue. The return of Chinese mainland technology giants to Hong Kong's stock market is a direct reflection of the dynamism and resilience of Hong Kong's economy. Uncertainty over listings in the US market has driven a surge in secondary listings by mainland companies in Hong Kong. 

Although some Western media outlets are most likely to continue to slander Hong Kong, the long-term attractiveness of the city's financial market will retain. Despite short-term economic downturn caused by the COVID-19 pandemic, Hong Kong's financial sector still enjoys solid foundations to grow. 

The author is a reporter with the Global Times.