SINGAPORE: Singapore’s Minister of Law and Home Affairs doesn’t believe the island city-state stands to benefit from any instability in Hong Kong, as protests stretch into a third month.
The rival financial centres are widely seen as investor-friendly havens from which to tap into fast-growing Asian markets.
Since protests started in June, sparked by a proposal to ease extraditions to the mainland, the idea has been mooted that business leaders wary of increased Chinese meddling in Hong Kong could move their money and operations to Singapore.
“There’s no profit in seeing instability,” K Shanmugam said in an interview with the South China Morning Post, according to a transcript published on the Ministry of Law’s website.
Singapore benefits from stability across the Asia-Pacific region, including in Hong Kong and China, he said. “And if Hong Kong is at odds with China, it’s a problem for everyone, including us.”
Long competitors for foreign investment, the economic outlooks for both Hong Kong and Singapore have dimmed in tandem amid an ongoing trade war between the US and China, with Hong Kong additionally buffered by the continued unrest.
Hong Kong Financial Secretary Paul Chan warned the Asian financial hub is entering “a very difficult economic environment” as trade declines and growth slows.
Meanwhile, in Singapore, Prime Minister Lee Hsien Loong in his National Day address August 8 said the government would be willing to stimulate the economy if necessary amid a trade-induced slowdown.
Shanmugam said it would take a lot more than the current protests to make serious investors leave Hong Kong.
“Unless people become pessimistic about China, I don’t see immediate calculations being made by serious investors,” he said. “People with an easy ability to transfer money may do different things. But I think other serious investors understand Hong Kong’s position.”
China’s ultimate support of Hong Kong will help the city weather the situation, Shanmugam said, an advantage that Singapore doesn’t have.
“The general impression that Singaporeans would have is that we are glad this is not happening here because we are different from Hong Kong,” he said.
“We are different from Hong Kong because we don’t have the same advantages that Hong Kong has. Hong Kong can weather it. Singapore may not be able to weather it.”