The Biden administration warned investors about the risks of doing business in Hong Kong, issuing an advisory that said China’s push to exert more control over the financial hub threatens the rule of law and endangers employees and data.
“Business and rule of law risks that were formerly limited to mainland China are now increasingly a concern in Hong Kong,” according to the advisory, which was issued by the Departments of State, Commerce, Treasury and Homeland Security. Shortly before the advisory was issued, Beijing pledged a “firm response” to any action by Washington.
It comes amid news that China plans to exempt companies going public in Hong Kong from first seeking the approval of the country’s cybersecurity regulator. The exemption, which, according to people familiar with the matter was outlined by officials in recent meetings with bankers, would remove one hurdle for businesses that list in the Asian financial hub instead of the US.
Citigroup said in May that it plans to hire more than 1,000 professionals across its wealth franchise in Hong Kong over the next five years, stepping up its expansion amid an increasingly heated grab for talent in the region. Goldman Sachs Group is hiring 320 staff in China and Hong Kong, as China opens its $54 trillion financial market fully to foreign brokerages and asset managers.