Hong Kong has long been at the centre of global trade and commerce thanks to its strategic position at the gateway to China in the South China Sea. Over time, the city has cornered a significant portion of trade passing through the region and its fortunes have only improved since the onset of globalisation in the past four decades or so. In 2015, Hong Kong ranked 8th in terms of global trade, and only one percentage point behind the three next biggest centres of UK, France and Netherlands; a remarkable statistic for the compact city. This is especially prescient given the size of countries such as China, US, Japan and Germany that lead the table.
But all is not well in Hong Kong, and trouble brews in the South China Sea. Politics at home and geopolitics abroad are both a cause for concern for a place that relies so heavily on stability, rule of law and calm waters in the seas surrounding its borders. Hong Kong itself seems unsettled as China tightens its political grip on what could be seen as an overt attempt to diminish ‘One Country, Two Systems’ model and move Hong Kong closer to China’s sovereign heart. In 2014 there was unprecedented social disruption centred around the Occupy Central and Umbrella Movement, shutting the CBD down for months and putting many SME businesses under financial stress and in some instances, out of business completely.
Today, while Hong Kong seems to have returned to normal and business is back in swing, there remains an undercurrent of uncertainty. A revival of the sentiments from 2014 could again cause a commotion down in Central town. People may forget that 2017 is the date earmarked under the basic law for the introduction of universal suffrage in Hong Kong; a process that China should have started in earnest years ago had they any intention to implement it. So with this brewing in the background, together with well-publicized instances of interference in the media and increasing discord about the number of mainlanders taking advantage of the city’s infrastructure, there seem to be plenty of touch points for a flare up.
At the same time, there is uncertain geopolitical risk swirling around the Pacific as the US President Elect appears to be squaring up to China over the key issues of Taiwan and its Sovereign rights to strategic interests in the South China Sea. While it is nigh on impossible to predict exactly what may happen, already China’s sabre rattling with Trump in the media has mentioned and interference as a “declaration of war”. This is cause for concern for anyone living and working in Hong Kong, and especially business owners with local interests that could be impacted by any trade war between China and the US, or indeed military action.
Assessing the risks of these concerns is a job for the analysts, commentators and policy makers. In the event that events took a turn for the worst, Trusted Union becomes a trusted business partner in protecting and insuring your investment and livelihood from the worst effects of any future commotion affecting Hong Kong.
Our firm provides insurance solutions that can help to mitigate these risks, whether your business operates in retail, hospitality or the service sector we can provide your business with the advice you need to protect against the uncertainty affecting the fabric of the societies where you operate.
If you are a business owner we can help to provide protection for the financial consequences that you may suffer for business interruption and physical loss or damage to your business due to terrorism, the threat of terrorism, government intervention, civil commotion, riots and strikes.
For more information please contact Liam@trustedunion.com