Tokyo, Sydney Move to Entice Financial Firms From Hong Kong
(28 July 2020 – Hong Kong) Japan, Australia and some other countries are laying out incentives to attract financial institutions in Hong Kong that are worried about the new security law imposed by China, but finance sector experts said even if they move, it will be to Singapore.
Hong Kong’s financial regulators said last week they had been approached by institutions concerned about the law, but they said it would not affect operations. Japan included attracting “excellent human resources” to form a global financial centre in an economic policy roadmap earlier this month, following official remarks they could win business from Hong Kong.
Busan in South Korea is offering tax breaks and rent-free offices to financial firms, while Taiwan is counting on the island’s rule of law and democratic values to attract business. However, lawyers and advisers say Singapore is the most likely beneficiary of any relocation, largely due to its corporate tax rate of 17 percent, a business-friendly environment, and its standing as a financial centre.
East and Partners’ Regional Treasury Centre (RTC) research reveals that about 10 percent of large corporates across the globe are looking to set up additional RTCs in Singapore over the coming year.
“The political upheaval in Hong Kong has created an opportunity for Australia and Sydney to become a stronger regional financial centre,” Senator Andrew Bragg wrote to Australia’s Treasurer this month, proposing policy changes.