Hong Kong’s extradition law jolts business community

Top executives in Hong Kong have warned they will have “no reason to stay” if the city’s freedoms are damaged by a proposed bill allowing extradition to mainland China. In a trend that could be damning for the international finance hub, some businesses say they would consider moving if the controversial bill -- which has provoked a huge backlash in the city -- is passed.

“Hong Kong is a jewel,” the French boss of an investment company said on the condition of anonymity, “where we do not fear being bothered by police.” But that could be about to change, with the proposed extradition law applying not only to Hong Kong citizens but also to foreigners living in the semi-autonomous territory -- or even people in transit at the international airport. Hong Kong’s “real strength comes from the application of the law, from the rule of law.

You do not go to prison for no reason. No one will close your business without reason and without you being able to defend yourself in court,” added the investment boss. The territory, which operates under a “one country, two systems” model where Hong Kong keeps freedom of speech and assembly rights unseen on the mainland, flourished at the end of the 20th century as a global financial centre and a gateway to its giant neighbour -- now the second largest economy in the world. But an increasingly assertive Beijing is extending ever more control over the city, chipping away at its semi-autonomous status.

Pandora’s Box

With its sky-high rents and tiny living spaces Hong Kong has long been under pressure from its regional rival Singapore for the title of Asia’s business capital. But “the credibility of Hong Kong is now on the line,” Tara Joseph, president of the American Chamber of Commerce Tara Joseph told CNBC, especially given the acrimonious trade war with Beijing.

Outside the city, there has been disquiet over the bill. Washington has warned the law could “damage Hong Kong’s business environment and subject our citizens residing in or visiting Hong Kong to China’s capricious judicial system”. The European Union also expressed concerns the law could have “potentially far reaching consequences for Hong Kong and its people, for EU and foreign citizens, as well as for business confidence in Hong Kong.”