Hong Kong leader Carrie Lam endorsed a stronger presence for HSBC Holdings Plc in attacking the UK for discrediting the bank and for not containing the coronavirus, while Prime Minister Boris Johnson opens the door for millions of residents of the territory to move.
In an interview on Thursday with Bloomberg Television, Lam said he would “love” to see HSBC expand into Hong Kong, where it has been increasingly criticized for freezing activist accounts and supporting the financial center’s comprehensive national security law. Lam also said that China would probably not take action against creditors who comply with U.S. sanctions, which the law prohibits.
“I don’t see why the Central People’s Government would take such action,” said Lam. The Hong Kong chief executive added that her government “would continue to work with the banking sector in Hong Kong, not just to increase its business in Hong Kong. Kong, but also in the Greater Bay area, because that’s where Hong Kong’s strength lies ”.
Lam has been trying to convince multinational companies to stay in the country while the United States, the United Kingdom and other Western nations criticize China for acting to silence democracy advocates after historic protests in 2019. Britain on Sunday will begin accepting visa applications for as many as 2.9 million Hong Kong residents with British passports (Overseas), as well as their dependents, who together represent almost 70% of the city’s population.
Lam said he did not see how many people would like to move to the UK, noting that his National Health Service was under “tremendous pressure” while praising Hong Kong’s hospitals. Still, she said she would respect the decisions of anyone who wanted to move and said the government needed to work to improve their lives.
‘Grilled’
Lam’s comments on HSBC came after she said that CEO Noel Quinn was “interrogated” for complying with Hong Kong law. On Tuesday, he defended the bank’s decision to freeze that of a former Hong Kong lawmaker when questioned by UK lawmakers.
Quinn said the move was purely driven by the need to comply with local laws and that he was not in a position to make a “moral or political judgment” on these issues, he said. He also said he was “trying to stay out of one country’s policy against another and do the right thing with our customers”.
The London-based bank, which has Hong Kong as its largest market, has been caught up in mounting tension as China tightens control over the former British colony. The bank has faced criticism in China for cooperating with the Huawei Technologies Co. investigation, and received criticism in Washington and London after its chief executive in Asia last year publicly endorsed a controversial security law imposed on the city.
China is the key to the bank’s recovery plans, which include transferring billions in capital for expansion in Asia and cuts in Europe and the US
Record contraction
Lam called the Hong Kong regulatory regime “rule-based”, in contrast to what he called “politically oriented” US sanctions. She said she understood why people and companies were considering alternatives to the territory, but said that “the money has not yet been moved.”
Photographer: Takaaki Iwabu / Bloomberg
“Hong Kong will continue to strengthen our competitiveness to attract more capital,” she said.
Official data released on Friday are likely to show that Hong Kong’s economy shrank a record 6% in 2020, the second consecutive year of contraction, according to economists polled by Bloomberg. The city is expected to reveal its budget in February.
Lam said Hong Kong’s economy has a good chance of achieving positive growth this year, subject to the course of the pandemic. She pointed to the improvement in export and import growth figures in the second half of last year as signs of recovery and said spending on retailers and restaurants will increase as soon as restrictions on the virus are lifted. Lam said it is necessary to stimulate the economy to create jobs.
Lam continued to defend the security law, saying it allowed political opposition in Hong Kong, as long as no one crossed the “red line”. When asked if she would seek a second term in 2022, she said, “I am not answering that question.”
– With the help of Alfred Liu, Ambereen Choudhury and Eric Lam
(Updates with quotes from Lam over)