My Take | Why China is delaying draft anti-sanctions law for Hong Kong
- It’s more important for the city and Beijing to stay close to Wall Street than hitting back at Washington
The draft law was expected to be passed for Hong Kong to counter foreign government sanctions, especially those from the United States. Now the legislative momentum seems to have been halted.
Experts have offered various explanations. But one is the most obvious, that is, if you follow the money. Despite all the vitriol and antagonism between Washington and Beijing, Wall Street and China have never been closer.
Imposing an anti-sanctions law on international financial institutions that have complied with Washington’s sanctions against Hong Kong and mainland Chinese interests and personnel would put them in an untenable position.
Despite all the talk about decoupling, China has been more open to foreign financial institutions than ever. Goldman Sachs, BlackRock and JPMorgan are all finally jumping into bed with big Chinese banks to form highly lucrative wealth management partnerships to tap into an underdeveloped pensions market potentially worth trillions; likewise, Amundi and Schroders from Europe.
Paradoxically, thanks to the crackdown on Chinese firms listed in the US by American regulators and politicians, Hong Kong and Shanghai have become the default choices for their so-called homecoming (stock relisting) or initial public offerings for other mainland firms.