The strategic advantages of doing business in Hong Kong have been indisputable over the years, given its special status as a free market economy and close geographical proximity to both China and other East Asian countries. But today’s reality is marked by uncertainty as the status quo has been challenged in more ways than one.
The National Security Law passed in 2020 coupled with the mass demonstrations dating back to 2019 have changed the outlook. While Swedish companies still consider Hong Kong an important business hub in APAC, the majority believe that the political tensions will have a negative impact on operations.
This is just one insight revealed in this year’s Hong Kong Business Climate Survey, which follows up from Team Sweden’s previous survey carried out in 2018.
As many as 82% of respondents reported that their business operations in Hong Kong were either profitable or reached break even in 2019. At the same time, the answer indicate a clear deterioration in terms of how the business climate is perceived, compared to 2018.
Some 55% of respondents believe that the National Security Law will jeopardise Hong Kong’s status as an international trade centre. Around 40% believe that this will result in a talent drain and recruitment difficulties in the long term. Despite these challenges, decision-makers have so far not changed their investments plans.
Download the report for a full overview of the results.
This survey was carried out in May 2020 and included 147 member companies of the Swedish Chamber of Commerce in Hong Kong, with a total of 79 respondents and a response rate of 54%. A complimentary survey regarding the implications of the new National Security Law was sent out in early August 2020, with a total of 62 responses.
ABOUT THE SURVEY
The Business Climate Survey is produced on a bi-annual basis by Team Sweden, a joint initiative where Business Sweden collaborates with Sweden’s local embassies, consulates and chambers of commerce around the world, among other stakeholders.
The survey provides first-hand perspectives and insights into business trends, issues and challenges on global markets based on extensive interviews with Swedish companies operating in each respective country.