Across The Border | Brexit uncertainty hurts Hong Kong in medium term, but may pay off in long run

Saturday marked 100 days since Britons voted to leave the European Union, but the continued uncertainty has been making life difficult for companies doing business in Hong Kong.

However, some Asian analysts are optimistic that in the longer term a divorce between the EU and its second largest economy might drive businesses from both eastwards, with Hong Kong well placed to benefit.

“Brexit means Brexit” has been the mantra of the UK’s new prime minister Theresa May, who on Sunday at least cleared up the question of timing, telling the BBC that she will trigger the process to leave the EU by the end of March 2017, but gave few details beyond the timing.

“In the longer term, the uncertainly as to Britain’s relationship with EU will cause problems for Hong Kong companies invested in the UK,” said Daniel Poon, the Hong Kong Trade Development Council’s principal economist for global research.

“A number of Hong Kong companies have already indicated they would move some of their investments out of the UK if it were not to have good access to the EU [after Britain leaves].”

Not only might these companies’ new destinations be less attractive, the move would entail significant costs.