Hong Kong’s government proposed an extradition bill in early 2019, which saw immediate protesting by individuals and businesses alike. The primary reason being that if passed, it will affect the city’s entire economy. Over 100 companies based in Hong Kong went on strike to protest the bill. It has since been shelved, however that did not slow down the protests.
Hong Kong’s stock market only recently replaced Japan’s as the world’s third most valuable. But the current political climate is quickly changing that for the worse. The Confederation of Trade Unions organized a city-wide mass strike on Monday which resulted in the Hang Seng Index closing nearly 2.9% lower, the lowest since last October.
The on-going protests are hurting retail sales and property market as well. Wharf Real Estate Investment, owner of the leading shopping malls in the city, was dealt the biggest blow on the HSI. Their stock downed 4.7% since Times Square Mall, their major tourist magnet, happens to be located very close to the area covered by recent protests. Sun Hung Kai Properties, one of Hong Kong’s significant developers, lowered 5.2%.
Monday’s mass protest also included flight crews going on strike resulting in the cancellation of more than 100 flights. Cathay Pacific Airways, the city’s chief carrier, lowered 4.2% after cancelling over 70 flights. The Mass Transit Railway dropped to 3.4%, their biggest loss of the year. MTR train service often gets disrupted by the protestors.
HSBC, counted among the largest banking services the world over, has closed two branches in Queensway, Hong Kong since the protesters blocked the road by parking their cars and placing barriers. Other banks that followed suit include Standard Chartered Bank, China Citic Bank and the Bank of East Asia.
The protests have lead local moguls and high net-worth individuals to move their assets to the mainland and other countries such as Singapore. The ongoing strikes also continue to scare away the very foreign companies and investors who used to consider Hong Kong Asia’s financial hub and economic goldmine.