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Hong Kong’s zero Covid approach frustrates businesses, analyst says

Hong Kong’s strict, zero-Covid approach is the main frustration for foreign companies operating there, an analyst told CNBC on Tuesday.

The city maintains strict Covid measures – with up to three weeks of mandatory quarantine and other testing requirements – even though authorities elsewhere have relaxed similar restrictions.

Asked about the impact of local politics and Covid measures on business confidence in Hong Kong, the founder of publishing and research firm Big Brains said the latter was the biggest concern.

“I think it’s more frustration right now in Hong Kong, especially among foreign companies… following its zero Covid strategy – and its announcement of its opening to [the] rest of China before it opens up to the rest of the world, which makes things quite frustrating for business leaders here, as well as for their families and their way of life in general, ”said Simon Cartledge .

“It’s been a long time,” he said. “It’s very difficult to travel.

Authorities in Hong Kong and the mainland have made efforts to establish quarantine-free travel between the two regions. China also has a zero Covid strategy.

This week, Hong Kong tightened measures again as omicron cases increased globally.

The city has clung to its zero-Covid approach despite a low number of cases compared to other places in Asia. The city has a 7-day moving average of 0.72 daily cases per million population as of December 19, compared to 66.75 for Singapore and 1.14 for Japan, according to Our World in Data.

Governments in the Asia-Pacific region, including Singapore and New Zealand, initially took an aggressive approach through tight lockdowns and restrictions during most of the pandemic. But many countries around the world have switched to a ‘living with Covid’ approach as vaccination rates have increased.

But Allan Zeman, chairman of property developer Lan Kwai Fong Group, argued that strict Covid rules have helped Hong Kong stay safe.

“But yet it worked backwards, it helped Hong Kong because we can walk freely on the street. Everyone wears a mask. It is very, very important,” he told CNBC’s “Street Signs Asia”. “I think in general we’re safe and it’s different from the horror stories I’m watching in Europe and the US right now.”

Several cities across Europe are reintroducing restrictions. In the UK, cases are doubling about every other day as hospitalizations increase in London. On Monday, the United States Centers for Disease Control and Prevention said omicron is now the dominant Covid strain in the United States, accounting for 73% of sequenced cases. The average daily number of cases in New York City more than doubled in the week ending Friday, December 17.

Zeman said consumer spending has been “unbelievable” over the past six months due to fewer people traveling out of the territory. Hong Kong retail sales rose for the ninth consecutive month in October, rising 12% from a year earlier to reach HK $ 30.7 billion ($ 3.94 billion), according to the reports. government data released in November, according to Reuters.

Attack the “Five Eyes”

Zeman, who was running in this week’s election for Hong Kong’s Legislative Council, defended changes to Hong Kong’s electoral system and attacked the Five Eyes intelligence-sharing countries for criticizing the overhaul.

The Five Eyes alliance, comprising Australia, Canada, New Zealand, the United Kingdom and the United States, issued a statement on Monday expressing “grave concern at the erosion of democratic elements” in the system. Hong Kong election.

Previously, half of the representatives of the Hong Kong Legislative Council were directly elected by ordinary Hong Kongers; under the new rules, about a fifth were. An electoral committee that previously held only limited powers now hand-selects nearly half of the council’s representatives and filters out anyone who wants to run for other seats.

Zeman, who lost his race but works as an economic adviser to Hong Kong Managing Director Carrie Lam, said: “I would defend Hong Kong by saying that Five Eyes should focus on its own country and look at its markets first. systems, which I don’t do. think it works fine. I think this is a new system for Hong Kong that can really work.

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