American business concerned over Sino-US relations, HK's fractious politics

Half of the American companies in Hong Kong surveyed are optimistic about the new year, but 40 percent expect the business environment to remain unstable or worsen, a survey shows.

Troubled US-China relations remained the top business concern along with Hong Kong’s fractious political situation, Hong Kong government policies, a resurgence of coronavirus infections and the cost of doing business in HK, said the American Chamber of Commerce in Hong Kong.

A majority of respondents feel the Hong Kong government needs to present a clear, transparent strategy when deciding on coronavirus-related business and school closures, AmCham's survey found.

A third of those surveyed feel Hong Kong has become less competitive as an international business hub.

Overall, there are starkly opposed views on the outlook for Hong Kong, with some expecting business to rebound, while others see risks following the implementation of the National Security Law.

Most businesses expected the city to remain as their regional headquarters for the next three years, though downsizing is already taking place due to cost-cutting and concerns over Hong Kong’s future as a major business hub.

The Greater Bay Area was viewed as an opportunity for future profits with access to the region’s vast consumer market a key draw. However, just as many respondents view Vietnam as an increasingly important market with new opportunities arising in countries such as India.

With close to 1,400 members, AmCham is one of the largest American Chambers outside the United States, the largest international chamber in Hong Kong.

The survey was taken between December 11, 2020 and January 4, 2021.