First grey was the new black. Then Thursday was the new Friday. And now Singapore is becoming the new Hong Kong as wealthy residents of China’s Special Administration Region look towards moving their wealth to somewhere they believe is safer.
Locals and investors are feeling jittery following months of unrest in Hong Kong, which has caused the city to go into what chief executive Carrie Lam describes as a “technical recession”.
Lam made the remark in October 2019, after retail sales fell by almost a quarter and as visitor numbers dropped by more than 40%.
But Hong Kong’s issues are not all local, the on-going trade war between China and the US has added to its woes.
Hong Kong’s place in the global financial markets can not be understated. It is used by foreign companies as a springboard to invest in Chinese companies, and China uses it to attract foreign direct investment (FDI). In an Economist Briefing in August 2019, it was estimated that as much as 60% of China’s inbound FDI flows through Hong Kong.
“There have never been as many new accounts opened in Singapore,” one person connected to the industry told CJI.
As well as wealthy individuals looking to safeguard their money and investments, greater-China businesses are increasing their operations in south-east Asia.
We are also starting to see management and charter companies based in greater China expand into Singapore and south-east Asia.
Sino Jet recently opened an office in Singapore, and Amber Aviation says that it has recently taken an aircraft under management in the region.
Singapore’s airports, unlike Hong Kong’s, are not slot constrained and are frequently quoted as being amongst the most business jet-friendly airports in the region.
With Asian Sky Group’s 2019-year end fleet report due to be published in April, we could see the first tentative signs of a shift between areas of operation taking place. But in 2020, we are likely to see much more.