More Hong Kong expats head for the exit
Almost half of European companies with hubs in Hong Kong are planning to relocate to other centres overseas this year, according to a new survey.
30 March 2022The Beijing-imposed security law introduced in the former British colony almost two years ago and the more recent, strict pandemic controls have led to companies eyeing an exodus, the survey by the European Chamber of Commerce in Hong Kong (EuroCham) found.
According to the survey of 260 members, 25% of respondents said they planned to fully relocate, with another 24% saying they intended to partially move offices and staff.
Another 34% said they were unsure over whether to stay or go and only 17% indicated they had no intention of shifting operations.
"Hong Kong still holds business opportunities but an array of issues, especially draconian travel restrictions and worsening US-China relations, weigh on sentiment," the US report said.
The city's 'zero Covid' strategy - which, until recently, required almost all inbound travellers to self-isolate at their own expense for three weeks - has led to severe consequences for businesses and residents, EuroCham said.
Hong Kong's "biggest advantage" was seen as its global connectivity and proximity to mainland China, EuroCham said, but that "has been almost completely disabled".
Although Hong Kong recently lifted flight bans and scaled back the city's quarantine requirements to seven days, the expat exodus has already got underway.
CNN commented: "For some, the travel restrictions have proven to be a final straw after years of watching Beijing encroach on Hong Kong's policy.
"Even without the Covid crisis, head-hunters were having trouble bringing talent to Hong Kong because of Beijing's growing oversight of the semi-autonomous territory.
"Massive and at-times violent protests prompted by a Beijing-imposed extradition bill plunged the city into a political crisis in the summer of 2019. A year later, as Covid-19 restrictions kept protesters at bay, China passed a wide-ranging national security law that broadly curtails free speech rights in Hong Kong."
Now, the pandemic clampdown appears to have been the final straw for many firms. "The ongoing 'zero-Covid' strategy has come at a very high cost for Hong Kong's business community," EuroCham said.
"The responses of our contributing firms portray a distressing landscape with...half of the companies in Hong Kong experiencing unusually high staff turnover and/or planning to relocate their operations outside Hong Kong."
Half of respondents in the survey cited "unusually high staff turnover" and difficulties in hiring overseas talent because of tight border controls and high costs. A third of companies said that more than a quarter of their staff had moved away.
Increasing numbers of indigenous Hongkongers are also looking to relocate, according to a poll conducted by Hong Kong's Public Opinion Research Institute. Nearly a quarter of 6,723 respondents said they planned to leave the city, a 4% rise on a similar survey in August.
Individual freedoms were the most commonly cited reason for emigrating, with many residents lacking of confidence in the political system. Robert Chung, the institute's president, said the wave of emigration could last for at least two or three years.
"The [political] system was changed quite forcefully, and the Hong Kong government has lost its autonomy," Mr Chung said. "Quite a lot of incidents have demonstrated the government is no longer serving the Hong Kong people."
Since it was introduced just over a year ago, more than 100,000 Hong Kong residents have applied for UK visas under the British National (Overseas) scheme.
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According to the survey of 260 members, 25% of respondents said they planned to fully relocate, with another 24% saying they intended to partially move offices and staff.
Another 34% said they were unsure over whether to stay or go and only 17% indicated they had no intention of shifting operations.
COVID restrictions causing expats to leave Hong Kong
The EuroCham survey this month reflected a similar report from the American Chamber of Commerce in January, which found that 44% of expats and businesses were likely to leave the city, citing Covid-related restrictions."Hong Kong still holds business opportunities but an array of issues, especially draconian travel restrictions and worsening US-China relations, weigh on sentiment," the US report said.
The city's 'zero Covid' strategy - which, until recently, required almost all inbound travellers to self-isolate at their own expense for three weeks - has led to severe consequences for businesses and residents, EuroCham said.
Hong Kong's "biggest advantage" was seen as its global connectivity and proximity to mainland China, EuroCham said, but that "has been almost completely disabled".
Although Hong Kong recently lifted flight bans and scaled back the city's quarantine requirements to seven days, the expat exodus has already got underway.
CNN commented: "For some, the travel restrictions have proven to be a final straw after years of watching Beijing encroach on Hong Kong's policy.
"Even without the Covid crisis, head-hunters were having trouble bringing talent to Hong Kong because of Beijing's growing oversight of the semi-autonomous territory.
"Massive and at-times violent protests prompted by a Beijing-imposed extradition bill plunged the city into a political crisis in the summer of 2019. A year later, as Covid-19 restrictions kept protesters at bay, China passed a wide-ranging national security law that broadly curtails free speech rights in Hong Kong."
Hong Kong sees huge loss as firms relocate to different cities
The American Chamber of Commerce survey found that 80% of US firms reported being impacted by the national security law, with almost half of employers saying they had lost employees who had decided to emigrate.Now, the pandemic clampdown appears to have been the final straw for many firms. "The ongoing 'zero-Covid' strategy has come at a very high cost for Hong Kong's business community," EuroCham said.
"The responses of our contributing firms portray a distressing landscape with...half of the companies in Hong Kong experiencing unusually high staff turnover and/or planning to relocate their operations outside Hong Kong."
Half of respondents in the survey cited "unusually high staff turnover" and difficulties in hiring overseas talent because of tight border controls and high costs. A third of companies said that more than a quarter of their staff had moved away.
Increasing numbers of indigenous Hongkongers are also looking to relocate, according to a poll conducted by Hong Kong's Public Opinion Research Institute. Nearly a quarter of 6,723 respondents said they planned to leave the city, a 4% rise on a similar survey in August.
Individual freedoms were the most commonly cited reason for emigrating, with many residents lacking of confidence in the political system. Robert Chung, the institute's president, said the wave of emigration could last for at least two or three years.
"The [political] system was changed quite forcefully, and the Hong Kong government has lost its autonomy," Mr Chung said. "Quite a lot of incidents have demonstrated the government is no longer serving the Hong Kong people."
Since it was introduced just over a year ago, more than 100,000 Hong Kong residents have applied for UK visas under the British National (Overseas) scheme.
Related reading from Relocate Global
- Hong Kong visa applicants top 100,000
- U.S. expats eyeing Hong Kong exit
- Oxford ‘Top UK city to live and work’
Read more news and views from David Sapsted.
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