More than half the US firms in HK are ‘very concerned’ about the new security law, survey shows

04-Jun-2020 Intellasia | CNBC | 6:02 AM Print This Post

More than 80 percent of the US companies in Hong Kong surveyed by the American Chamber of Commerce said they’re concerned about China’s plan to impose a new national security law in the city.

Out of the 180 AmCham members that responded to the survey earlier this week, 53.5 percent were “very concerned,” while 30.0 percent were “moderately concerned” about the security legislation. The survey results were published on Wednesday and are not intended to be scientific, said the chamber.

Respondents cited concerns such as threats to Hong Kong’s overall business environment, as well as the legislation’s potential impact on freedom of speech and other “basic civil liberties.”

The survey which the chamber called “a temperature test of members’ sentiment” came after China’s top legislative body last week approved the proposal to impose a national security law in Hong Kong.

Fears of eroding autonomy

Hong Kong, a former British colony that returned to Chinese rule in 1997, is governed under a “one country, two systems” principle that allows the city greater freedom than its mainland counterparts. Those freedom include self-governing power, limited election rights, as well as a largely separate legal and economic framework from mainland China.

Such autonomy has underpinned Hong Kong’s success as a global financial and business centre so far.

The process of enacting China’s new law will bypass Hong Kong’s legislature, which raised concerns over the city’s eroding autonomy promised under the “one country, two systems” framework. The city has been reeling from months of pro-democracy protests sparked by a controversial extradition bill which at times turned violent, and has sent its economy into a recession.

The new law is aimed at prohibiting secession, subversion of state power, terrorism activities and foreign interference some reports said it could also lead to Chinese intelligence agencies setting up bases in Hong Kong. Critics say the law could grant the central government broad powers to crack down on dissent and protesters.

US revokes Hong Kong’s special status

As Beijing pushed ahead with the national security law, US President Donald Trump said he would “begin the process” of eliminating Hong Kong’s favoured treatment under American law.

“Hong Kong has been hit by a double-whammy in the past week, with China announcing a proposed national security law, while President Trump said he would begin the process of revoking the US-HK special economic status,” said Tara Joseph, president of AmCham in Hong Kong.

Authorities in Beijing and Hong Kong have said the legislation would not affect the special administrative region’s autonomy. But 60 percent of US firms surveyed by AmCham thought the law would harm their business operations.

Some companies said implementation of the law could result in a reduction in foreign investments into the city, as well as greater difficulty in hiring as people leave or avoid Hong Kong.

Still, around 70.6 percent of survey respondents said their companies don’t have plans to move capital, assets or business operations out of Hong Kong, while 62.2 percent said they personally won’t consider leaving the city.


Category: Hong Kong

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