Page 1 of 2

Even the slightest cut in information free flow – alongside the ability to communicate this via free speech – could chip away at Hong Kong’s legendary financial hub status. finews.asia talks to industry practitioners in the city.

It goes without saying that information is by far the most critical commodity in the world of financial markets. This is maybe even more so the case for Hong Kong, evidenced by increasing application of newly emerging capabilities such as artificial intelligence, data analytics or broad-based digitalization.

That’s why industry watchers were perturbed after Beijing proposed national security law bypassing Hong Kong’s local legislature due to its potential impact to free flow of information and free speech – critical components for operating an efficient financial market with both sound integrity and risk controls.

Research Self-Censorship?

Although the law aims to target activities defined as subversion, secession, foreign interference and terrorism in Hong Kong, some onlookers fear the cultural ramifications from enacting any bill viewed as excessively hard line. Especially if legislation is ambiguous, financial institutions and its professional workers are likely to exhibit a greater level of restraint in any communications – including research – when interacting with external parties on issues with serious political implications. 

«Here in Asia, companies are not only more likely to toe the line. They want to be a few steps behind it,» said an unnamed Asia head of investment advisory from a global private bank to finews.asia. «This might be okay for day-to-day communications. But what if there is an urgent need to advise clients to offload risks? What if there is severe economic stress? And what if these events are caused by politically sensitive issues? What can or can’t we say then?»

There is already precedent where an employee was reportedly called out for communicating professional views that were politically unaligned. As recent as late 2019, Law Ka-chung former Hong Kong-based chief economist at Chinese state-owned Bank of Communications claimed he was condemned multiple times including once for saying that the 2003 SARS outbreak had a greater impact to the local economy than anti-government protests.

No Latency Affordable

In addition to information disseminated by financial institutions, some are also concerned about hurdles from the receiving end.