Nearly half of foreign companies in Hong Kong plan to relocate

But lately, as Beijing has tightened its hold on the former British colony, these firms are increasingly eyeing a way out.

Nearly half of all European businesses in Hong Kong are considering relocating next year, according to the agency. new report. The companies cite the local government’s extremely strict Covid-19 protocols, which are similar to those in place on the mainland.

Among firms planning to leave Hong Kong, 25% said they would completely move out of Hong Kong in the next 12 months, while 24% plan to relocate at least partially. Only 17% of companies said they have no plans to move within the next 12 months.

A report from the European Chamber of Commerce says the city’s “zero Covid” strategy has led to major repercussions for businesses and residents. The chamber said Hong Kong’s “biggest advantage” – its global connectivity and proximity to mainland China – “has been almost completely cut off.”

Hong Kong’s quarantine is notorious among residents and expats alike. At one point, the government required most incoming travelers to self-isolate in hotel rooms at their own expense for three weeks, one of the longest periods of isolation in the world.

Although Hong Kong officials recently lifted flight bans and reduced the city’s quarantine requirements to seven days, a massive exodus is already playing out.
Last week, Hong Kong Chief Executive Carrie Lam acknowledged that the protocols were undermining residents’ satisfaction with the city, saying she had “a very strong feeling that people’s tolerance is fading.”

A European poll released tracks Thursday with a similar American Chamber of Commerce report for January that showed 44% of expats and businesses are likely to leave the city, citing Covid-related restrictions.

“There are still business opportunities in Hong Kong, but a number of issues, especially draconian travel restrictions and deteriorating U.S.-China relations, are weighing on sentiment,” the U.S. report said.

For some, the travel restrictions have proved to be the final straw after years of watching Beijing encroach on Hong Kong politics.

Even without the Covid crisis, bounty hunters have had trouble attracting talent to Hong Kong due to Beijing’s growing oversight of the semi-autonomous territory. In the summer of 2019, massive and at times violent protests sparked by a Beijing-imposed extradition bill plunged the city into a political crisis. a law restricting freedom of speech in Hong Kong.

More than 80% of US firms in Hong Kong said they were affected by the National Security Act, according to an American Chamber of Commerce report. Nearly half of them noticed that staff morale had suffered and said they had lost employees who chose to emigrate.

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