Three Cities That Challenge Hong Kong’s Financial-Hub Status | WSJ


(guns firing) – [Erin] After a long summer
of protests in Hong Kong, credit rating agency Moody’s changed its outlook for
the city to negative. Banks, hedge funds and
other financial specialists may now consider life outside Hong Kong, a place known for its liberal economy and direct access to China. So where could they go? Singapore, Tokyo and Shanghai
are possible options. In March, the three financial hubs were just behind Hong Kong in a ranking of the competitiveness of more than 100 financial centers. So could these cities get
more of Hong Kong’s business? Singapore has a lot of the same qualities that make Hong Kong attractive. The city state has rule of law
and an attractive tax system and just like Hong Kong, it has the ubiquitous use of English. It’s also a major center
for wealth management but Hong Kong has one
really big advantage. It’s a gateway to China. – Hong Kong is part of China, but it has its own special
legal and regulatory system. Singapore of course, has got a lot of cultural
affinities with China, and there’s a big Chinese diaspora there but of course it’s a separate country and I don’t think for Chinese companies and for Chinese officials,
it’s quite the same thing to list a business in Singapore as it is to list it right
next door in Hong Kong. – [Erin] As a result,
Singapore’s stock market has always been smaller than Hong Kong’s. – Very roughly, the Singapore market is about a quarter the size
of the Hong Kong market in terms of the capitalization. – [Erin] In September,
when the Hong Kong Exchange made a surprise take over proposal to the London Stock Exchange, the LSE’s board rejected the order and said it actually preferred Shanghai as a direct channel to access China. Shanghai already serves
as mainland China’s most advanced financial hub, including bond and stock
markets capitalized at trillions of dollars. Its exchange is already
larger than Hong Kong’s and it is forecast to grow much further in the coming decades, but being in China can also
be seen as a disadvantage. – China still operates capital control so you can’t take money in and out of the country very easily, given that there’s quite a complicated and opaque legal system, and so often companies
feel that they’re operating in an unfair system. – [Erin] For years, the government has been
liberalizing the financial sector to attract foreign
institutions and their money. (speaks Chinese) But the bureaucracy so far has
hindered Shanghai’s ambition as a truly global financial center. Tokyo is the capital of the
world’s third largest economy. It is a place where companies
enjoy the rule of law and which boasts deep markets. The city has more Fortune 500
companies than anywhere else and in late August– – [News Announcer] Aramco
might list in Tokyo. – [Erin] The city made big news with a Saudi Arabian oil giant. – The Japanese authorities
might be comfortable with a slightly lower level of disclosure about things like reserves for example, which might make it easier for Aramco, which is a very politically
sensitive company to list in Tokyo. If Tokyo won a listing of Aramco, that would be a really
big feather in the cap of that stock market. – [Erin] But there are
factors holding Tokyo back. Taxes are higher than in
Hong Kong or Singapore. Tokyo also has stricter VISA requirements. It’s also a less cosmopolitan place. Language is a big barrier; it can be difficult for
companies to find employees who have a good command of English. The country was rated
32nd in latest HSBC list of top expat destinations, way behind even mainland China. Many financiers say that Hong Kong is still the only city in Asia to offer the combination
of the rule of law, an open capital account and a convenient base for
jumping into the Chinese market, yet the long months of protests
are already taking a toll. Chinese E-commerce giant
Alibaba recently put a blockbuster listing
there on hold for instance. Hong Kong is scheduled to
keep its special status as a semi-autonomous region until 2047, but as Beijing’s grip on
the territory increases so does uncertainty
about what might happen in the near future. (upbeat music)

58 thoughts on “Three Cities That Challenge Hong Kong’s Financial-Hub Status | WSJ

  1. Hong kong losing its position as an economic hub? Us peasants dont care! What happens when economy is bumping up and up? Everything gets more expensive! Its not like we have to consider about the companies anyway.

  2. Beijing's grip on HK increase? Give an example. You can't be like Gordon Chang claims China is collapsing year after year without giving a good reason.

  3. The people of HK are incredibly ignorant and irredeemably stupid. They do not know what they are fighting for. The external forces and internal traitors are just too evil and greedy.

  4. These kids are waving Americunt flags like they are going to be their saviours. The fact is that they are being used as cannon fodder for the US's superpower struggles with China. Not only have the kids sacrificed their own future, but they have destroyed the future of their own families.

  5. As a Malaysian I truly envy Singapore, Kuala Lumpur has the potential to be the next Singapore if the all races can speak mandarin, malay, and english or even tamil, but no….most politicians care about racial and religion benefit rather than the country as a whole.

  6. Competitors ?? No need of them. HK has already been phased out by the big cities and banks in China since 2010. From 1873 to 1918, HK was the ONLY international trading hub for China, the British colony handles every trade in/out of China. Then the Chinese big cities and foreign banks rose up in the 1920s, and took some tradings away from HK. WW II broke everything, then in 1949 the CCP shut down all the foreign trades from China. The opening of Chinese trades in the late 1970s again use HK for handling of every trade financial transaction. This make trillions of fees for HK banks, trade companies and business.

    However, since the 2000s, the big Chinese cities, banks and trading companies took over the majority of direct international trades. HK was phased out as the Chinese trade/finance hub, and has lost trillions of income (GDP 0.1%). This inevitable fate let HK sits on the highest real estate values with lowest incomes earned as a city. Those 10 HK real estate billionaires charge the highest rents but offer minimum jobs, i.e. C.K. Li, what else can you do except PROTEST ??

  7. How good if Malaysia and Indonesia is Chinese government.. if they let chinese people handle the country by hope.. they can get in Rank 10 already.. by today… sadly.. they are not known at all…

  8. Singapore dream on, instead of gaining status it will lose. As soon as HK restore order and democracy. New canals in Malaysia and Nordic route were all making strait malacca a history like turkey.

  9. These youngsters are destroying Hong Kong piece by piece… who are they going to blame when they can’t find jobs in the future?

  10. Hong kong protesters are a bunch of idiots. They will doomed .Many other people will go to hong kong and teach them protesters and reporters a lesson

  11. China’s ruthless regime is the greatest danger to freedom and democracy in the world, western capitalist created this monster, and now this tyrant regime is spreading its brutal and criminal system of oppression to other dictators around the world. China and Russia are trying to destroy western democracies. But capitalist don’t mind if western governments become like Chinese system, because for them profit and greed is the ultimate value. See how much money they are pouring into Trump’s campaign, who is an insane corrupt president.

  12. Shenzhen is the only alternative, yet not mentioned in this video. If a port is build, HK's economy is much corrupted. Cuz most of the ships that enters through the HK port is Chinese, how stupid are the protestors gambling with their cities future.

  13. In other words, what WSJ is saying, if I infer correctly, the reason HK is an attractive option because of access to the big China mkt vs SG or Tokyo + rule of law sep from the mainland. But it seems that the access to a big china mkt is still the reason why it's a more attractive option. Which means to say that the only person to do themselves in are the HK people themselves if they continue this protest indefinitely, damaging investors' confidence, and the CCP may decide they have enough of such protests and make HK irrelevant with their policies, like it or not. All the posturings from the western societies are just that, posturing which will not deter China should they be single minded in choking off HK because of its continued waywardness and defiance. They forgot to mention one that is nearer though still on the mainland. Shenzhen, whose GDP already exceeded that of HK in 2018.

  14. All three will be knocked out by earthquakes… if Hong Kong is independant by then they will be the richest among all of em.

  15. The future for HK as a viable financial hub in this part of the region is written in the 'Tea Leaf'. Shenzhen and Macau are perfectly poise to replace HK's current financial position in southern China. The anti-China politicians and western indoctrinated youth in HK will be a constant source of HK's political headaches through to year 2047 when the One Country Two political System will ends. By then, 80% of the hardcore anti-China youth of today, who would be in their late 40s, would have migrated to become second class citizens in Australia, England and USA. This is Karma for these hardcore anti-China protesters who thought Freedom is FREE.

  16. I prefer Tokyo. As a Mandarin speaking Northerner non-Han minority. Japanese eat Ramen, I eat La Mian/ Lagman. Singaporean and Hong Konger eat rice, I don't like rice. Plus, non of the four cities mentioned in this video that their native tongue is Mandarin (Not even Shanghai, they speak Wu dialect- Shanghaiese). Language is indifferent to me. I do not like Mainland China surveillance, so Shanghai and Hong Kong are off the table. Singapore is too hot. There is not even four seasons. Conclusion: I would prefer Tokyo.

  17. 傻逼老外和白痴一样的,对,大陆会把香港的地位让给新加坡和东京,呵呵,这视频真鸡巴弱智。

  18. hahah,im from shenzhen china with hk id,and my family have serval houses in hk,believe me,hk is nothing in Chinese opinion now

  19. We HongKongers don't care as much about financial status anymore, if freedom and democracy don't thrive anymore, this city is doomed anyway. #StandwithHongKong

  20. I lived in both Singapore and Hong Kong for many many years. Singapore is so boring that after a few years it will become a synonym for boring. The weather sucks, the only outdoorsy activities are flashy malls and a few artificial gardens. The government is trying to keep an eye on every aspect of your life, there are security cameras in every inch of the place. The government tries to preach residents about every tiny aspect of their life. Anyone who was not a Singaporean was dying to get out of the suffocating country.

    HK on the other hand was full of life. Nowhere were you more than 20 minutes away from beautiful mountains and beaches. I so wish HK retains its spot as the best place to live and work in Asia.

  21. HK is Gone, past tense. Simple fact. Singapore and Tokyo is already far in front HK. ShangHai could be too crowded by Chinese population. Singapore lead in Language and man power

  22. Dont be so excited fellow singaporeans, soon your so called country will become Singapore, China when you become more attractive than HK 😏 Just look at what China did to Australia

  23. Honestly no city in the world has the power to take Hong Kong’s status, like really no one. Hong Kong is too unique and too important at this point so nope no one can compete with HK yall can keep dreaming about Singapore taking the lead lol 😂

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