Dr Jonathan CHOI Koon-shum (Chairman of the 51st terms of office) July 2020
The National Security Law will not affect Hong Kong’s intrinsic advantages. In the long run, it is instrumental to creating a thriving and more stable business environment positive for the development of Hong Kong.
The gazettal and implementation of the Law of the People’s Republic of China on Safeguarding National Security in the Hong Kong SAR (the National Security Law) is favorable to the long-term prosperity and stability of Hong Kong and the wellbeing of its people. The HKSAR government should actively encourage all social sectors to facilitate the implementation of the law and undertake publicity work to eradicate doubts and increase investor confidence.
Eliminating uncertainties in the business environment
In the recent year, Hong Kong has witnessed escalating violence, including acts that challenge the sovereignty of the country. These illegal activities have endangered public safety and order, and hurt the local economy and the business environment. By plugging the legal loopholes that existed in Hong Kong, the National Security Law enhances the country’s legal framework and enforcement mechanism for safeguarding national security. The law includes various details and can foster stability and boost the confidence of local and overseas investors in the long term. Hong Kong will only continue to prosper when national security is ensured.
The National Security Law has sparked international concern. The US has announced the suspension of preferential treatment to Hong Kong over China and threatened further sanctions. This move is regrettable and damaging to the US economy as Hong Kong is a major source of US goods trade surplus. Moreover, the National Security Law targets serious crimes such as subversion of state power and should not affect businesses operating legally in Hong Kong. The rights and freedoms of the people remain protected by the Basic Law.
US sanctions targeting only certain trade areas will unlikely bring serious damage to the Hong Kong economy. Even if the US imposes higher tariffs on Hong Kong goods, the actual impact would be limited. As for the US’s move to halt export of high-tech products to Hong Kong, these products can be sourced from elsewhere.
Exploring further economic diversification
In the face of the Sino-US conflict, different sectors must prepare and equip themselves properly. The deepening of reform and opening-up and development of regional economic cooperation in the Mainland have led to a huge demand for financial services and high-end services, providing abundant opportunities for Hong Kong’s professional services. This year, the Mainland government has launched a number of measures to open up the finance sector, which lay solid grounds for Hong Kong to consolidate its positioning as the financial hub in the Guangdong-Hong Kong-Macao Greater Bay Area and its status as an international financial center.
We hope the HKSAR government will evaluate the short-, mid- and long-term impact of the Sino-US conflict and the National Security Law on the Hong Kong economy. Meanwhile, it is important to diversify the economy, accelerate the development of innovation and technology, and provide support for emerging industries boasting a competitive edge and development potential. The authorities should also strengthen trade and economic ties with neighboring regions and seek to join the “Regional Comprehensive Economic Partnership” (RCEP), expected to be signed this year, to open up new opportunities.
To summarize, the National Security Law will not affect Hong Kong’s intrinsic advantages. In the long run, it is instrumental to creating a thriving and more stable business environment positive for the development of Hong Kong. In short, the implementation of the National Security Law will lead Hong Kong out of the woods and bring it back on the right track to scale new heights.