Protests and Beijing’s tightening grip rattle Hong Kong business community

Fishing boats sail through Victoria harbour in Hong Kong on Monday, to mark the 22nd anniversary of the handover from Britain to China. Many Hong Kong residents now fear the city is surrendering its independence to Beijing. (AFP)
Updated 03 July 2019

Protests and Beijing’s tightening grip rattle Hong Kong business community

  • City's outlook as a finance hub clouded by violent unrest and fears of Chinese crackdown, managers warn

HONG KONG: Chaotic scenes of protesters rampaging through Hong Kong’s legislature, trashing furniture and daubing graffiti over walls, have sent jitters through the business community, which worries about the impact on the city’s status as a financial hub.

Plumes of smoke billowed among gleaming skyscrapers early on Tuesday as police fired tear gas to disperse protesters in the heart of the Chinese-ruled city, home to the offices of some of the world’s biggest companies, including global bank HSBC .

Escalating unrest over a controversial extradition bill, which would allow people to be sent to mainland China for trial, grabbed global headlines and clouded the former British colony’s outlook as a finance hub, one of the city’s main pillars of growth.

“I think there will be damage to the reputation of Hong Kong,” said Yumi Yung, 35, who works in fintech. “Some companies may want to leave, or at least not have their headquarters here.”

About 1,500 multinational companies make Hong Kong their Asian home because of its stability and rule of law. Some of the biggest and most violent protests in decades could change that perception.

Hong Kong returned to Chinese rule in 1997 under a “one country, two systems” formula that allows freedoms not enjoyed in mainland China, including freedom to protest and an independent judiciary. Monday was the 22nd anniversary.

Beijing denies interfering, but for many Hong Kong residents, the extradition bill is the latest step in a relentless march toward mainland control. Many fear it would put them at the mercy of courts controlled by the Communist Party where human rights are not guaranteed.

“If this bill is not completely scrapped, I will have no choice but to leave my home, Hong Kong,” said Steve, a British lawyer who has worked there for 30 years.

Daniel Yim, a 27-year-old investment banker, said both sides needed to sit down and work things out.

“I think the most effective way to address this will be that the government will actually tackle this and speak to the people, and I guess, you know, both sides sit together and come up with the appropriate solution.”

Others raised concerns about the future of human rights and the judiciary. Many did not want to use their full names.

“To me, the biggest worry is how Hong Kong is losing its independence bit by bit, and is getting dangerously close to a country that doesn’t value human rights and that doesn’t have an independent judicial system,” said Edward, an Australian who has worked in the financial sector for 10 years.

The extradition bill, now suspended but not scrapped, has also spooked some tycoons into moving their personal wealth offshore, according to financial advisers familiar with the details.

An Australian businesswoman who has worked in Hong Kong for 16 years lamented what she saw as Beijing’s tightening grip.

“China is just taking away more and more freedom from Hong Kong,” she said.

“I feel sorry for Hong Kong people, especially people who are here for more freedom, a better economy, a better life, and now it’s going backwards,” the woman said.

Such concerns came as China’s leading newspaper warned on Wednesday that outbreaks of lawlessness could damage Hong Kong’s reputation and seriously hurt its economy.

Calm has returned for now, but the events of recent weeks have set many people thinking.

“If it had escalated, I would consider moving elsewhere,” a 44-year-old hedge fund manager said of the ransacking of the legislature. “I employ four to five people in Hong Kong, so, yes, I would consider moving.”


Saudi defense contractor to invest up to $16 million to further localize services

Updated 18 November 2019

Saudi defense contractor to invest up to $16 million to further localize services

DUBAI: Saudi-based defense contractor Middle East Propulsion Company (MEPC) plans to invest between $13 million and $16 million over the next two years to build test cells for aircraft engines and establish new production lines.
These expansion activities should complement the company’s objective to localize high-tech repairs and combine them in one roof for the Saudi defense ministry, which is a major customer, CEO Abdullah Al-Omari told Arab News.
Instead of sending aircraft engines and engines modules overseas for further servicing, thus take up more time before military assets return to actual service, localization not only cuts the turn-around period but also reduces Saudi government spending for the repairs.
“We have accomplished more than 1,600 engine and engine modules [since 2001, they] have been maintained totally in Saudi Arabia,” Al-Omari said at the sidelines of the Dubai Airshow. “The engines consume 45 percent of what you spend on aircraft.”
The company works on 150 to 160 engines and engine modules every year.
MEPC is the first specialized MRO (maintenance, repair and overhaul) company operating in the Middle East, according to its website. It has invested over $26 million during the previous two years for the localization of its MRO services.
“We used to send these parts to outside, it takes 6 months to 24 months sometimes … in case of the Apache engines, minimum turn around is 24 months,” Al-Omari said, but their localization efforts have greatly improved their capability by cutting the turn-around period to only 150 days.
The speed at which MEPC is able to repair engines and modules, boosts the readiness of Saudi military, Al-Omari added.
The company is in talks with major defense contractors, including Honeywell for the Abrams talks and GE T700 engines, for possible tie-ups to further improve their capability, he said.
“Currently there is a potential with the Kuwait army to provide them with similar services [being delivered to the Saudi defense ministry],” Al-Omari said, and expects that cooperation would start “within the next two years or so.”