By Marine Vanhoucke, associée et Laurent Eugène, avocat collaborateur OLN
Hong Kong: the return to "normal"
Hong Kong: the return to “normal”
Hong Kong lifted all restrictions on entry to its territory, more than three years after the first cases of COVID-19 appeared and the first measures to fight the pandemic.
At the same time, China has just opened its border with Hong Kong, which had remained closed since January 2019. The decision comes as China accelerates the withdrawal of strict rules against COVID-19 that have hit and stunted its economic growth.
The opening means the resuming of non-quarantine travel between the Hong Kong financial centre and mainland China, although this will initially be done in a "gradual and orderly" manner, according to local authorities.
China and HK are thus reopening their doors to the world, welcoming international travelers and returning residents without quarantine for the first time since the pandemic began.
While never really imposing a city-wide containment, Hong Kong closely followed China's "zero infection" policy until mid-2022, when it began to ease some restrictions and reduce its quarantine measures.
The former British colony has now abandoned all its COVID-19-related rules, the exception of wearing a mask, which remains mandatory.
The renewed optimism of the various economic actors
Hong Kong, whose economy has been largely impacted since 2019, is waiting with undisguised impatience for the resumption of flows at its border. Before the pandemic, mainlanders accounted for around three-quarters of arrivals in Hong Kong.
In terms of attracting foreign investment and talent, the signal sent by Beijing will have a very positive effect, observers say.
Travelers have already started to flock to the mainland since Sunday and many Chinese are also planning to start traveling abroad again, especially to Hong Kong.
Investor confidence is on the rise and early Hong Kong economic indicators show a new dynamic.
The change in policy initiated by China has been welcomed by the markets, and the main stock exchanges have been rising for several days.
Hong Kong, a key gateway to the Chinese market
Hong Kong is still among the top three countries in the ranking of investment flows into China. However, very few of the investments made in China from Hong Kong have a purely Hong Kong origin. A large proportion of these investments only "pass through" Hong Kong and come from other regions of the world (USA, EU, South America...).
In view of this, opening a Hong Kong company still appears to be a must for investments in China. And if the last three years have taught us to be cautious, as the region has undergone major changes, there is a good chance that Hong Kong's geographical location will enable it to maintain its unrivalled economic dynamism and its nickname of "Asian New York".
Marine Vanhoucke advises companies on Intellectual property and accompanies them on their subjects of Compliance.
Head of Hong Kong office, she assists French companies in their establishment and growth in Asia and has built up expertise in legal issues of international law, notably combining French and Asian interests.