Financial Secretary of China's Hong Kong Special Administrative Region (HKSAR) government Paul Chan said on Sunday that the national security legislation for Hong Kong will not affect free flow of capital into and out of Hong Kong, operation of the linked exchange rate system, and Hong Kong's status as an international financial center.
Although the threatened U.S. sanctions have caused a little disruption on the market, the actual impact is limited for the time being, Chan wrote in his blog.
Hong Kong does not adopt foreign exchange control and ensures the convertibility of the Hong Kong dollar and free flows of capital, Chan noted, stressing that the policy, one of the determining factors of Hong Kong's financial center status, is enshrined in the Basic Law.
Hong Kong's linked exchange rate system is supported by its more than 440 billion U.S. dollars of abundant foreign exchange reserves and backed by the nation, Chan wrote, stressing that the system has withstood the test of time and is irrelevant to U.S. policies.
Responding to U.S. threat to impose sanctions against Hong Kong, Chan wrote that the U.S. move will only have limited impact on Hong Kong's goods imports and exports.
The United States raked in nearly 300 billion U.S. dollars of surplus from its trade with Hong Kong during the past decade, Chan noted, adding that any restriction will in the meantime harm the interests of U.S. companies.
The national security legislation is aimed at bringing peace back to Hong Kong and restoring a safe and stable business environment, Chan wrote, adding that there is no need for businesses to worry about it.
Chan stressed that Hong Kong's international financial center status is not a gift from other countries but an achievement from its hardworking and the strong support from the motherland.
As the second largest economy, China, with deepening reform and opening-up and financial services demand created in the process, will provide a solid support for Hong Kong to remain as the global financial center and continue to move forward amid external uncertainties, Chan wrote.
