HONG KONG — In an interview with The Associated Press on Monday, the president of the American Chamber of Commerce in Hong Kong said that U.S. firms operating in Hong Kong should review their operations and consider if the risks of doing business there are worth the benefits.
Companies in Hong Kong, according to Tara Joseph, are caught in the crossfire between the United States and China. Her comments came after the US government published an alert on Friday warning firms about dangers in the former British colony.
The US-China relationship has worsened as a result of a trade war and rising tensions over China’s efforts to suppress political opposition in Hong Kong. Growing dangers, according to the Biden administration, include Hong Kong’s evolving legal landscape and Beijing’s increasing grip.
“The business landscape has obviously gotten more difficult than it used to be, and as far as business goes here, we’re absolutely in a new normal,” Joseph said.
Operating in Hong Kong, according to the US government advice, might result in reputational, legal, and data privacy concerns.
The Hong Kong government called it “unfounded fear-mongering,” accusing the US of hypocrisy and double standards.
Beijing has been denying Hong Kong the freedoms it was promised 50 years ago when Britain handed up the territory in 1997. More than 100 pro-democracy advocates have been detained since a broad national security law was enacted last June, including Jimmy Lai, whose pro-democracy publication Apple Daily was forced to shut after police arrested at least seven of its workers and froze millions of dollars in assets.
Despite months of few coronavirus cases, Hong Kong authorities have changed voting laws, imprisoned most of the city’s most famous pro-democracy campaigners, and banned large-scale rallies, claiming public health dangers from the epidemic. The United States and other Western countries have reacted angrily to these actions.
China has retaliated, claiming that Hong Kong’s problems are within China’s internal affairs and that other countries should stay out.
The American Chamber of Commerce in Hong Kong is a non-profit organization that represents American commercial interests in the city. Last week, the group announced that it had doubled down on its commitment by purchasing a new headquarters to facilitate its work.
The Biden administration’s advice, according to Joseph, might affect the attitudes of U.S. firms that aren’t currently operating in Hong Kong. However, the city continues to be a vital center for doing business with mainland China.
Although Hong Kong has its own customs territory and nominally autonomous judicial system, analysts are concerned that the city’s famous “rule of law” is being eroded by the recent practice of designating numerous problems as coming under the National Security Law.
“Right now, in an international context, the rule of law is what makes businesses truly click. “At this time, commercial law appears to be extremely sound, which is very important to the business community,” Joseph added.
“However, any evidence of that being unraveled or any genuine changes taking place there may be quite concerning,” she added.
“Anything that undermines that can make it more difficult for Hong Kong to maintain its role as a gateway,” she said. “However, we hope that there will be a greater understanding and recognition that it is a win-win situation for people to keep their businesses here and for Hong Kong to keep its position as a gateway,” she added.