• 1 hour Chinese Stocks Soar On Bullish Economic Data
  • 7 hours Apple’s “Holy Grail Of Data” Leaves Energy Traders Disappointed
  • 9 hours Gold Rally Adds $250 Billion To Top 50 Miners' Market Cap
  • 1 day TikTok Is Becoming A New Battleground For Tech Politics
  • 1 day Peru's Mining Industry Pummeled As Coronavirus Cases Surge
  • 1 day Why The World Is So Divided In Its COVID-19 Response
  • 2 days Equities Cheer Stellar Jobs Report, But It May Be Fleeting
  • 3 days Is Tech Billionaire Peter Thiel Done With Trump?
  • 3 days Musk Takes To Twitter To Troll The SEC
  • 4 days Lunar Mining May Commence As Early As 2025
  • 5 days Immigration Will Go Bust Without $1.2B Bailout
  • 5 days The Economics Of The Space Race
  • 6 days Why The World's Central Banks Aren't Yet Sold On Renewables
  • 7 days How Much More Cash Can Uber Burn?
  • 7 days Inside The Biggest Counterfeit Gold Scandal In Recent History
  • 7 days EU-U.S. Trade Relations Are Deteriorating
  • 8 days Over 184 Companies Have Bailed On Facebook
  • 8 days BP Sells Petrochemical Business For $5 Billion
  • 8 days U.S. Moves To Secure Domestic Rare Earth Supply
  • 9 days E-Commerce Explodes As Boomers Go Digital
EU-U.S. Trade Relations Are Deteriorating

EU-U.S. Trade Relations Are Deteriorating

The U.S. Trade Representative’s office…

Saudi Arabia Is Fighting A War On Two Fronts

Saudi Arabia Is Fighting A War On Two Fronts

Short on funds and allies,…

Why The World Is So Divided In Its COVID-19 Response

Why The World Is So Divided In Its COVID-19 Response

The Covid-19 pandemic should have…

Josh Owens

Josh Owens

Writer, Safehaven.com

Josh majored in International Relations at the University of Edinburgh and is currently the Content Director at Oilprice.com. Josh has over 6 years of writing…

Contact Author

  1. Home
  2. News
  3. Breaking News

Protests And Trade War Crossfire Taking A Toll On Hong Kong’s Wealthiest

Hong Kong

Hong Kong is seething, and it’s draining multiple billions from the wealthy elite.  Nearly two million people have taken part in a mass protest in Hong Kong against a controversial extradition bill, and those protests have escalated over the past five days to the point at which stores have shut down, air travel has been disrupted, and clashes have erupted between police and demonstrators.

All in all, it’s wiped some $19 billion from Hong Kong’s 10 wealthiest people, according to Bloomberg Billionaires Index, which says protests have had a massive impact on the wealth of those tied to Hong Kong-listed companies.

The protests were sparked over a month ago by opposition to a controversial bill that would have allowed extradition from Hong Kong to China. The bill has since been suspended, but not fully withdrawn.

In the meantime, the protesters demands evolved to include calls for greater democracy, an independent investigation into alleged police brutality and the resignation of the city's leader, Carrie Lam.  

As protesters sought to shut down the city with a general strike, landlords, retail stocks, tourism industry are taking the hit.

On Monday, Hong Kong was hit by travel chaos as more than 230 flights to destinations around the continent were cancelled, as air traffic controllers join a citywide strike that is disrupting the financial hub. Mass Transit Railway (MTR) was also affected as protesters prevented trains from departing. 

By Tuesday, the MSCI Hong Kong Index was on a 10-day losing streak of the kind it hasn’t seen since 1997, in the runup to its handover from a British colony. 

Related: Turkey Blames The West For Pre-Election Lira Volatility

The last day of gains in Hong Kong’s equity market was July 23rd. 

Hong Kong’s richest man, Li Ka-Shing is down about $2.7 billion alone. 

Beyond the fate of Hong Kong wealthy elite, ongoing protests are jeopardizing Hong Kong’s status as a safe and stable hub for investors.

All 10 industry groups on the Hang Seng Composite Index have dropped. 

Hong Kong retail sales, a key part of the city’s economy, were already feeling the heat back in June, dropping 6.7% from a year earlier. 

Cathay Pacific Airways, Hong Kong's largest carrier, declined4.2 percent after the airlines scrapped flights leaving the city.  Also, shares of government-owned railway operator MTR Corp fell 3.4 percent.

Then there’s the mounting fear of a response from Beijing that goes beyond the rhetoric. 

Initially, reports suggested that Beijing might deploy forces to Hong Kong, but China later said it would not interfere. 

According to a revised forecast from HSBC, 350,000 fewer visitors from China will brave Hong Kong this year. And other visitors may also decline with Britain, Japan, Singapore and Australia all issuing travel alerts following the violent protests. 

Hong Kong was already feeling the pressure from U.S.-China trade tensions. That pressure intensified last week when Trump threatened another 10% tariff on the remaining $300 billion worth of Chinese goods starting September 1st.

On Monday, China let its currency, the yuan, drop to 1.4 percent, a decade-low, and reportedly told its state companies to suspend imports of agricultural products from the U.S. in retaliation.  

Intensifying protests just put what was already a trend on more solid footing: 

According to Capgemini’s 2019 World Wealth Report, the net worth of Hong Kong’s ultra-wealthy was already showing signs of cracking, with one in 10 starting out 2018 as high-net-worth individuals losing that status by the end of last year.  

By Josh Owens for Safehaven.com

More Top Reads From Safehaven.com:

Back to homepage

Leave a comment

Leave a comment