Tammy Tam

City Beat | Plan A or Plan B for business? What Wendy Sherman’s China visit tells foreign investors in Hong Kong

With Hong Kong remaining a sticking point in China-United States relations, US deputy secretary of state simply turning up to bargaining table is best result in the circumstances

So long as bilateral contact continues amid turbulent tides, foreign investors should be smart enough to appreciate Hong Kong’s unique advantages

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US deputy secretary of state Wendy Sherman arrived in the major port city of Tianjin on Sunday. Photo: EPA-EFE

Tammy Tam

Published: 5:41pm, 25 Jul 2021Updated: 11:18pm, 25 Jul 2021

Diplomatic negotiation is about showing your hand to bargain for the maximum interest. And when neither side accepts that the other is in any position of strength, showing up at the bargaining table is already the best result.

That is what US deputy secretary of state Wendy Sherman’s two-day visit to China is about.

Among the many thorny bilateral and regional issues such as Covid-19 pandemic control, North Korea, tension over the South China Sea and the Taiwan Strait, and climate change, Hong Kong remains a key sticking point.

The outcome is written on the wall: Sherman underscores Washington’s firm opposition to the imposition of the national security law in Hong Kong, but that is nothing more than a political statement as Beijing will not back down. In fact, Beijing has repeatedly urged Hong Kong to speed up local legislation to cover more national security crimes not specified in the existing law.

Hong Kong is sandwiched between the two superpowers, but unlike some Asian countries with close economic ties to China facing the dilemma of picking a side, the city does not have such a choice as it is a part of China.

It is not up to Hong Kong per se – foreign businesses operating here know the city must follow Beijing’s policies. However, investment decision-making involves more considerations than geopolitics alone.

When the White House earlier issued a business advisory warning US citizens of investment risks in the city, the American Chamber of Commerce (AmCham) here revealed on the same day that it had purchased an entire floor in a prime commercial building as “a long-term commitment to Hong Kong”.

While it was widely seen as a vote of confidence in the city, the transaction could simply be a good investment deal and not necessarily AmCham contradicting the White House, as some have suggested.