Investors not scared off by Hong Kong’s political uncertainty, says London Lord Mayor
UK capital’s ambassador for financial services brushes aside fears over Brexit and uncertainty created by stalled Hinckley Point nuclear project
Hong Kong’s current political uncertainty is not putting off potential British investors, according to the Lord Mayor of the City of London.
Jeffrey Mountevans, who is in Hong Kong for three days, acts as an ambassador for the United Kingdom’s financial and professional services industry.
“Hong Kong remains a very attractive place for UK investment. The relationship is very, very strong,” he said in response to a questions about how the political situation could be affecting investment in the city.
“I don’t think there’s any great shaking of that relationship at this time,” he added, pointing particularly towards fintech as “a great opportunity” for the two countries to work together.
After Hong Kong the Lord Mayor is due in Shanghai, to meet with officials from the stock exchange and from China Banking Regulatory Commission.
In July, Standard and Poor’s and Moody’s changed Hong Kong’s sovereign rating outlook from stable to negative, while Fitch Ratings warned that widening political divides could hurt the city’s economy.
On Tuesday, the Hong Kong Monetary Authority announced policy initiatives intended to spur banks in the city into embracing technology to make financial transactions safer, speedier, and more convenient for customers.
The Lord Mayor’s visit comes less than three months after the UK opted to leave the European Union, and also shortly after Prime Minister Theresa May’s new government stalled on the planned Hinkley Point nuclear power plant decision, which would have been part-funded by China Nuclear Power Generation.
On Friday he also worked hard to alleviate concerns that Brexit could end up hurting the UK’s position as the biggest RMB offshore centre.
“I don’t see this as one of the significant areas for legitimate concern. This process will continue. London will continue to play its leading role,” he told reporters at a news conference.
Instead, he said that London was entering a period of “considerable economic opportunity” with plenty of room for business ties with China, in terms of inward investment, bilateral trade and helping China in its role in international trade.
“Now when we talk trade with Hong Kong and mainland China we can concentrate on the specifics of what is beneficial, it’s a much-less complicated equation and discussion.
“We are going into a very positive phase ... we’re actually at the beginning of greater things.”
He also said the future of the proposed Hinckley Point did not undermine the UK’s commitment to deepening long-standing links with China.
“I don’t see that as a major bump in the road. You have to see that in the context of a huge range of projects that are being discussed.”
The Lord Mayor’s positive take contrasted with the views of Brian Coulton, chief economist at Fitch Rating’s sovereign and supranational group, who said uncertainty about how Brexit would affect British companies was likely to affect investment in the country.
“It’s far too early to be drawing conclusions that Brexit is having a materially smaller impact on the economy than estimated,” he told the Post.
“Our forecasts are that investment is going to fall quite significantly in 2017.”
Hong Kong is one of the UK’s biggest Asia-Pacific export markets, with £8 billion exported here every year, according to the Lord Mayor.
He will meet Financial Secretary John Tsang and the Hong Kong Monetary Authority during his time in Hong Kong before heading to Beijing, Shanghai and Tianjin.