HONG KONG, March 6 (Reuters) – Hong Kong’s status as a financial hub is increasingly at risk as the city becomes more entangled in U.S.-China tensions. The rapid sale of a Hong Kong-owned global ports business underscores the growing geopolitical instability, according to executives and analysts. U.S. President Donald Trump, who previously claimed that China was operating the Panama Canal, praised the deal. “The Trump administration views this as a successful strategy and may replicate it,” said Steven Okun, a senior adviser at Kroll.
As the U.S. intensifies efforts to counter China across trade, shipping, technology, and capital markets, industry insiders say Hong Kong faces rising uncertainty. Traditionally seen as independent from mainland China, Hong Kong firms are now reconsidering their strategies. “We constantly review our plans due to political tensions,” said an unnamed executive of a listed Hong Kong company. “For instance, should we still list units in Hong Kong?”
Since China implemented a national security law in 2020, some Western observers now view Hong Kong as fully under Beijing’s control, undermining its economic standing. Earlier this year, Hong Kong’s Far East Consortium and Chow Tai Fook Enterprise attempted to acquire Star Entertainment, a troubled casino group in Brisbane.
“Hong Kong is increasingly grouped with China, raising complexity and costs,” said a board member of a prominent Hong Kong business family. CK Hutchison, which initially sought to retain its Panama port operations, opted to sell amid concerns over reputational risks. “This is a nightmare,” said a source close to the negotiations.
While CK Hutchison stated the sale was unrelated to political reports, the Hong Kong government criticized U.S. accusations as unreasonable. A senior Chinese official described the situation as “politicized and weaponized.” Despite claims by Hong Kong’s financial secretary that the city remains a global hub, skepticism persists. “Market valuations reflect global perceptions,” said Vera Yuen, an economics lecturer at the University of Hong Kong.
Amid escalating U.S.-China rivalry, some Hong Kong firms are preparing contingency plans. “Our focus is staying as international as possible,” said a shipping executive. — news from Reuters.com