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Hong Kong, one of the largest and most important financial cities in the world, has partial autonomy from China. This is the position that is promised to the city until 2047 as part of the agreement that Britain and China made before the former British crown colony was returned in 1997.
After six years of demonstrations and protests in Hong Kong, the Chinese authorities have tightened their grip and cracked down on what they characterize as illegal civil disobedience. Hong Kong’s new security law makes it illegal to demonstrate.
Activists Ivan Lam and Joshua Wong, who became politically active at age 17 in 2014, were jailed in Hong Kong last week. Several others are imprisoned in China.
Banks fear sanctions
Several Western countries have reacted with sanctions against people in Hong Kong, including the city’s head of government, Carrie Lam. This has had consequences for him on a daily basis. Credit cards have been canceled and banks have terminated the customer relationship.
– I use effective every day for everything. I have lots of cash at home when salary is paid. I no longer have my own bank account, he says in an interview with the International Business Channel.
Chinese banks dare not give you a bank account or access to credit cards. They fear that this will trigger direct sanctions from the US authorities and a ban on the international financial system, where the US dollar dominates.
She is one of the highest paid leaders in the world with an annual income of HK $ 5.21 million (almost HK $ 6 million). In comparison, the American president earns 3.5 million crowns a year. Prime Minister Erna Solberg earns NOK 1.7 million.
– An honor
Lam defends the way Hong Kong ruled in the interview and rejected criticism that he is a front figure for the communist leadership in Beijing. The Hong Kong police chief and at least 13 other leaders of the financial city are part of the US sanctions.
“As Hong Kong’s chief executive, Lam was directly responsible for implementing policies to stifle freedom and democratic processes,” was the rationale for the US Treasury Department when the sanctions were introduced in August.
Reject criticism from the United States.
– For me it is an honor to be subjected to unjustified sanctions by the US authorities, he says in the interview.
Gives results
Critics of Lams believe his statements confirm that the sanctions have paid off.
“She says that no bank is willing to offer its financial services, not even Chinese state-owned banks. Her salary is paid in cash and she can only use cash. What does this mean? #StandwithHongKong,” she writes in a Twitter message. ex-protest leader Nathan Law, living in exile in London.
Lam’s son, Joshua Lam Yeuk-hay, 24, returned to Hong Kong from Harvard University just before the sanctions were introduced earlier this year.
Other key members of the administration have been forced to sell American real estate and shares of American companies due to the sanctions.
– Keep waiting for the headwind
US Secretary of State Mike Pompeo accused British bank HSBC, which has roots in Hong Kong and China, of maintaining client relationships with the sanctioned individuals, but did not allow the protesters to continue relationships with the clients.
The US State Department will identify, in mid-December, international financial institutions that have had client relationships with individuals subject to sanctions.
Hong Kong is in a deep recession. A new survey by the Hong Kong government shows that, for the first time in 11 years, the number of foreign-owned companies in Hong Kong has decreased. Only 15 percent of existing companies are planning an expansion.
– Honestly, I think there is still a lot of headwind waiting for Hong Kong. From a growth perspective, the bottom has probably been reached, Commerzbank senior economist Hao Zhou tells CNBC Asia.(Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We would like you to share our cases via a link, which leads directly to our pages. Copying or other use of all or part of the content may only be done with written permission or as permitted by law. For more terms, see here.
