Recent United States allegations about heightened business risks in Hong Kong are unlikely to undermine foreign investors’ interests in the city, as firms with a presence in the city are well-acquainted with the business landscape and will not be easily swayed by such politically motivated claims, business insiders and experts said on Monday.

Tom Chan Pak-lam, deputy chairman of Success Universe Group, said that the US’ move is ironic, as it is the US government, rather than Hong Kong, that is limiting its citizens’ investment opportunities. He likened the situation to “controlling a credit rating agency and issuing unfavorable ratings on someone you have ulterior motives to pressure and bully”.

Stella Lee Wai-fun, chairwoman of the Greater Bay Area Family Office Association, echoed this view. She said foreign investors have been navigating the Hong Kong market for years without facing any hurdles, so “any future challenges faced by US companies would stem from restrictions imposed by their own government, instead of Hong Kong.”

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The US companies coming to Hong Kong for business have a deep understanding of the city and are unlikely to be influenced by such a politically charged statement, said Terence Chong Tai-leung, executive director of Lau Chor Tak Institute of Global Economics and Finance at the Chinese University of Hong Kong.  

According to an annual report, the number of companies in Hong Kong with parent firms outside the city surpassed 9,000 last year, with 1,273 being from the US, ranking third.

In the first seven months of this year, InvestHK — a Hong Kong government department responsible for foreign direct investment — had completed 358 projects, up 40 percent from the same period last year. Among those projects, 32 were from the US, also placing it third.

In 2023, assets managed in Hong Kong exceeded HK$31 trillion ($4 trillion), with around two-thirds coming from investors outside the city.

“These figures are more than enough to knock down the US allegations,” said Yim Kong, a Hong Kong lawmaker for the commercial constituency.

More than 50 diplomats and representatives from foreign chambers of commerce attended the consular networking event hosted by the Chinese Manufacturers’ Association of Hong Kong on Aug 20. “The strong participation demonstrates their high confidence in Hong Kong’s business environment,” a CMA statement said.

Such rebuttals from various sectors, particularly the business community, in recent days “clearly reflect a deep-seated indignation toward the US’ unfounded attempts to undermine Hong Kong’s reputation”, and underscore the confidence in the city’s commerce landscape among all stakeholders, including foreign investors, Yim added.

On Friday, the US Department of State and four other departments released an updated business advisory, first issued in 2021, warning that the Safeguarding National Security Ordinance could heighten risks for foreign enterprises operating in Hong Kong.

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The bill, effective March 23, was enacted in line with Article 23 of the city’s Basic Law. It outlines actions deemed threats to national security, including treason; insurrection, incitement to mutiny and disaffection, and acts with seditious intention; theft of State secrets and espionage; sabotage; and external interference.

According to the Hong Kong Special Administrative Region government, 98.6 percent of the feedback during the consultation period for the Article 23 legislation was supportive, indicating strong public backing for the law.

In line with international standards, the legislation provides Hong Kong’s business environment with a more secure and reliable legal framework, which is conducive to enhancing the city’s appeal to international capital and professionals, Yim added.

Meanwhile, national security laws are not exclusive to Hong Kong. Many experts have questioned why the US believes its own national security legislation has no impact on foreign firms, but Hong Kong’s will.  

Contact the writer at irisli@chinadailyhk.com