Since violent protests broke out in Hong Kong in June, with no sign of improvement in the tense situation, the international business community has been worrying about the future of the territory as one of the world’s top financial centres.
The question increasingly being asked is whether Hong Kong can remain a “fragrant harbour” (as its Chinese name translates in English) for major banks and multinational companies, or whether it will be abandoned.
Such concerns have pushed the Chinese government to prepare a plan B. Beijing has attempted to mitigate the potential damage in case the disruption does not dissipate. For example, the central government in August issued a document to promote Shenzhen’s “core and locomotive role” in the development of the Hong Kong-Macau-Guangdong delta. The intention is clearly to build Shenzhen into the main financial hub in the region. And in July, Macau, a former Portuguese colony returned to Chinese sovereignty in 1999, was chosen by Beijing as the place to launch China’s first offshore treasury bond. The plan is to develop Macau’s small renminbi market, building it into a Chinese Nasdaq.