“The Biden administration in July issued a warning to US companies: Doing business in Hong Kong is increasingly risky. The advisory, released jointly by the departments of State, Treasury, Commerce, and Homeland Security, was basically a giant red flag cautioning companies and investors against the complications that are emerging under China’s national security law.
This tenuous political climate has shaken Hong Kong, but it has not yet upended its status as a global financial capital. The United States’s advisory is recognition that this might change as China continues its crackdown in the territory. International businesses — and their employees — could soon find themselves entangled in national security law enforcement.”
“China, for its part, is banking that Hong Kong’s infrastructure and economic climate will still make it a destination for foreign businesses in Asia despite the crackdown. After all, trade wars, tense Washington-Beijing relations, Beijing’s atrocious human rights record, and US sanctionshave yet to stopmost US firms from doing business in mainland China. And that may keep Hong Kong’s economic might intact while doing little to stop its democracy from crumbling.”