The reputation of the former British colony as an international financial centre has been battered over the past two years due to its adherence to China's unbending Covid restrictions. These restrictions have made the city less attractive for expats and harder for foreign executives to visit.
The chief executive of the Hong Kong government said at his inauguration in Mandarin that he would consolidate the city's inherent advantages, as well as Chinese President Xi Jinping. Lee didn't give any policy detail, nor did he address growing pushback against Covid policies and border controls that have alarmed many international companies.
A survey of European businesses in Hong Kong found that nearly half of them are considering moving to the next year. In January, a report from the American Chamber of Commerce found that 44% of expats and businesses were likely to leave the city. The US report said that Hong Kong still holds business opportunities but that there are still a lot of issues, including draconian travel restrictions and worsening US-China relations. Hong Kong has one real rival for businesses thinking of leaving Hong Kong's quarantine rules, and they are notorious among residents and expats. At one point, the government required most inbound travelers to isolate themselves in hotel rooms, on their own dime, for three weeks, one of the longest isolation periods in the world. Although Hong Kong officials have lifted the flight bans and scaled back the quarantine requirements, an outflow of talent is already playing out. Even without the Covid crisis, headhunters were having difficulty bringing talent to Hong Kong because of Beijing's growing oversight of the semi-autonomous territory. Xi said at the inauguration ceremony on Friday that Beijing would fully support Hong Kong in consolidating its status as an international financial, shipping and trade center and maintaining a free, open and regulated business environment. Lee said his government would also improve Hong Kong's current position in finance and shipping, as well as boosting the city's technology and innovation industries. Lee said that they will develop emerging industries and make Hong Kong an international innovation center. During his speech, Lee extolled China's Belt and Road and Greater Bay Area initiatives, which he said gave Hong Kong unlimited opportunities and unlimited development space.