Hong Kong is sliding down the maritime hub rankings fast, and unless swift regulation changes are made, especially relating to covid, the city is in danger of falling off the map. That was the stark warning given today by one of the Special Administrative Region’s (SAR) most outspoken maritime executives, Bjorn Hojgaard, the CEO of local shipmanagement giant Anglo-Eastern Univan Group.
Speaking at an event organised by the Hong Kong Maritime and Port Board and InvestHK designed to try and promote the Chinese city’s strengths, Hojgaard used his time at the podium to take aim at how local politicians have handled covid.
Hong Kong, which has branded itself as Asia’s World City for the past two decades, has laboured under very strict covid laws, which see quarantines and masks continue to this day.
We are in trouble, and the first thing you do when you are in a hole is to stop digging
Hojgaard said the covid laws were “absolutely counterproductive border restrictions”.
The Dane, who has been a vocal critic of the local government’s handling of the pandemic, pointed out that covid has changed, and is now less transmissible.
“When facts change, our mindsets should also,” he urged, hitting out at the level of gaslighting going on in Hong Kong, whose citizens have been forced to live under an “alternative reality” for the last couple of years.
Hojgaard said at the promotional event that Hong Kong did not have long to make changes, warning attendees it was already “five minutes to midnight”.
Hojgaard, a former chairman of the Hong Kong Shipowners Association, said many maritime companies had decided to relocate from the SAR, and he had heard of no firms keen to establish a presence in the former British colony.
He used his time at the podium to urge local authorities to stop acting like an ostrich.
“To be a hub for anything we need spokes,” Hojgaard said, going not to warn that “international Hong Kong” was under more pressure than at any other time he could recall in the past 25 years since the city returned to Chinese sovereignty.
“We are in trouble, and the first thing you do when you are in a hole is to stop digging,” the shipmanagement boss said.
Covid, in addition to the enacting of the national security law two years ago, has seen a significant exodus from the city.
About 121,500 residents departed the city in the year ended June 30, leaving the population at about 7.29m, according to government data released this month. That means the population fell 1.6%, marking the third straight year of declines and the biggest drop in at least six decades.
Hong Kong handed out just 32,248 work visas last year, down from 62,155 in 2017, according to the Immigration Department. Only 5,701 visas were approved for international workers under the General Employment Policy in the first half of this year, compared to 20,314 in the first half of 2018.
Fitch Ratings warned in a report this month that Hong Kong’s apparent prioritisation of national strategies and governance practices over economic competitiveness may undermine the city’s role as an international financial centre.
“If these risks crystallize, it would leave the economy less dynamic, accelerate fiscal policy challenges associated with aging and potentially contribute to downward pressure on the territory’s credit rating,” Fitch said in the report.
Hong Kong’s economy has recently slipped into its second recession in three years. “More than two and a half years of Covid-19 restrictions are taking a heavy toll on businesses and the economy,” the Hong Kong General Chamber of Commerce said in a statement this month.
Hong Kong fell to seventh place among the top maritime cities of the world, according to the Menon Economics and DNV’s 2022 report published in January. The SAR was placed fourth in the last report released in 2019. Meanwhile, the Xinhua-Baltic International Shipping Centre Development Index Report released in July placed the city fourth worldwide.
Other shipping and financial hubs in the region such as Singapore and Tokyo have been heavily promoting their strengths to companies looking at exiting Hong Kong in recent years with a number of well-known Hong Kong shipowners looking at alternate sites.