Is the sun setting on Hong Kong?
One does not have to search too hard to find a variety of voices offering opinions on Hong Kong. Somewhere between the tabloid criticism of Beijing by the Apple Daily and the Communist Party mouthpiece that is the Global Times, daily life has become disruptive as demonstrations against the introduction of national security laws by China continue.
Against this backdrop concerns rise for inward investment and the reputation of Hong Kong as a safe place to conduct business. The Territory was the conduit for 70% of direct foreign investment in China before the crisis, however many fear investors may now find alternative destinations for their funds.
In response to the imposition of the new laws, America is mulling stripping Hong Kong of its special trading status and adding measures that could impact the territory’s ability to do business.
A recent survey by the American Chamber of Commerce in Hong Kong showed that nearly 30% of its members were considering moving out of the territory. An even higher proportion, 38%, were personally considering moving.
China, meanwhile, has been developing the international credentials of the neighbouring city of Shenzhen and the country’s biggest city, Shanghai. Beijing has clearly indicated that China is no longer reliant on Hong Kong as the mainland’s gateway to international business. Under mounting criticism from China, HSBC, Standard Chartered and other big international firms have publicly endorsed the national security legislation.
To those resident in the Territory it is however perhaps no surprise to find the region again topping the 2020 annual Cost of Living Survey for expatriates produced by Mercer, a professional services firm.
Expensive property, crowded living conditions and the high cost of living, coupled with the political background and concerns for business, have seen many Hong Kong residents consider leaving the Territory. Many of those seeking to leave are young and well educated.
The three most popular destinations are Canada, Australia and Taiwan. The recent announcement by the UK Government that it is considering giving rights to live and work in the United Kingdom, through an extendable twelve-month visa, to the three million Hong Kong residents holding, or entitled to, British national overseas passports could perhaps also open another avenue.
Whilst there appears to be some ambiguity in the UK government position, and this may only come into play if China presses ahead with new security laws, there are other very attractive options open to wealthy residents seeking to relocate.
Through its network of offices, and in collaboration with our partners in other jurisdictions, the Probus Group has been active in working with wealthy individuals and their families seeking to relocate for business and lifestyle reasons.
We are located in jurisdictions such as Switzerland, United Arab Emirates, Mauritius and Monaco which are known to attract international families. Other countries, in addition to the United Kingdom, offering a favourable environment to new residents include Italy, Portugal, Thailand, Malta, Malaysia and Panama
The Probus Group not only helps with establishment in these jurisdictions and others but, combined with appropriate wealth structuring and asset management, we are well placed to assist clients in taking advantage of the financial benefits and favourable fiscal regimes that such relocation may offer.
This article has been carefully prepared, but it has been written in general terms and should be seen as broad guidance only. The article cannot be relied upon to cover specific situations and you should not act, or refrain from acting, upon the information contained therein without obtaining specific professional advice. Please contact Probus Group to discuss these matters in the context of your particular circumstance. Probus Group, its partners, employees and agents do not accept or assume any liability or duty of care for any loss arising from any action taken or not taken by anyone in reliance on the information in this article or for any decision based on it.