Brexit vote took me by surprise, Hong Kong’s financial chief admits
John Tsang warns of economic uncertainties ahead as a result of British voters opting to leave the European Union
The decision by British voters last week to leave the European Union was completely unexpected, Hong Kong’s financial chief said, as he warned of further uncertainty in the city and world economy as a result of the repercussions.
Writing in his weekly blog on Sunday, Financial Secretary John Tsang Chun-wah expressed concern that doubts in the aftermath of Brexit would further unsettle global trade and finance and affect Hong Kong’s economy.
When I got off the plane that afternoon and learned of the results, I felt really surprised
“Going forward, Britain and the EU will have to begin arranging years of lengthy post-Brexit negotiations, which for Britain, the Eurozone and global economy, will bring about long-term uncertainty,” Tsang said. “The government will continue to monitor these developments closely.”
The concern was shared by Hong Kong Monetary Authority chief Norman Chan Tak-lam last week when he urged Hongkongers to “stand ready to cope with continued market volatilities and to manage their risks prudently”.
But in an interview with the last week, Chief Executive Leung Chun-ying expressed confidence that Hong Kong could seize advantages arising from Brexit.
“I have every faith and confidence in Hong Kong business people and investors in turning challenges into new opportunities,” Leung said. “I am happy to say we are pretty well prepared for this outcome. The financial institutions in Hong Kong have passed their stress test; we have enough liquidity in the system.”
Based on public opinion polls and betting odds in the run-up to the referendum on Thursday, Tsang said he had been sure of a remain vote. He said he had even told reporters while he was in Beijing that most British nationals would likely vote to stay in the union. “When I got off the plane that afternoon and learned of the results, I felt really surprised.”
Tsang said while a majority still accepted the view that globalisation was the best and most efficient way to allocate resources, boost productivity and raise living standards, many people in recent years had not been able to reap the economic benefits. He pointed to the divergent results across England, Wales, Scotland and Northern Ireland.
“The results of this British referendum more or less reflect this sort of sentiment,” he said.
