Hong Kong finance chief warns city's reputation at risk
HONG KONG – Hong Kong's finance chief on Friday, October 3 warned that the city's huge pro-democracy protests will threaten its reputation as one of the world's premier financial hubs if they continue for much longer.
Finance Secretary John Tsang said his biggest fear was the "reputational risk" of extended unrest in the semi-autonomous city, seen by many investors as a gateway to the massive Chinese market.
"Particularly our (biggest) concern is about our reputational risk as well as the confidence in the market system in Hong Kong," Tsang told reporters.
He added that a slip in confidence in Hong Kong's financial sphere would "bring permanent damage that we could not afford."
Tsang said Hong Kong authorities had been working to minimize the financial impact of the protests, adding: "As of today the financial market, the stock market, and the foreign exchange market have been functioning properly and remain in good order."
Hong Kong shares ended 0.64% higher on Friday but the Hang Seng Index was well down for the week, having lost more than 3% over September 29 and 30. The exchange was closed on October 1 and 2 for public holidays.
"Hong Kong's banking system and currency board mechanism have been functioning normally as well, but due to the blockage of some thoroughfares by protesters, some bank branches and ATMs have (had) to close," Tsang said.
"The Hong Kong dollar exchange rate remains generally steady and no abnormality has been found in the foreign exchange market. The stock market has been operating smoothly."
He spoke as ugly clashes broke out in the busy Mong Kok shopping district between pro-democracy protesters and crowds of people opposed to their campaign, which has left swathes of the city at a standstill.
Tsang told reporters: "There is still no indication that the protest activities will end in the near future.”
"I would like to remind the public that the market will continue to be volatile and fluctuate in the short term. Investors should be mindful of the risks."
Analysts have suggested that the rival trading center of Singapore – and to a lesser extent the growing Chinese economic hubs of Shenzhen and Shanghai – could benefit from a slide in confidence in Hong Kong as a place to do business. – Rappler.com