Singapore— A recent report from media company Bloomberg has said that the amount Singapore stands to potentially benefit from the protests in Hong Kong over the last seventeen weeks is over five billion dollars (US$4 billion).
Bloomberg was quoting the higher end of an estimate from Goldman Sachs Group Inc. concerning funds that have been moved by investors to Singapore from Hong Kong due to the large-scale and often violent protests in the territory that began as a reaction to a contentious extradition bill in June.
Goldman Sachs recently estimated a maximum outflow of between US$ 3 to 4 million of Hong Kong dollar deposits to Singapore as of August, two months after the protests began.
Many investors have long viewed Singapore as a rival financial center in Asia to Singapore.
According to the Hong Kong Monetary Authority last week, local currency deposits dropped by 1.6 percent from July to August, showing the largest decline in over a year, to around US$873 billion (S$1,204 trillion).
While the first three weeks of September showed a small uptick, this was also a time before violence had escalated further.
Bloomberg says that analysts Gurpreet Singh Sahi and Yingqiang Guo wrote in a note, “We found modest net outflow from HKD(ollar) deposits in Hong Kong and modest net inflow of FX deposits in Singapore. We believe the debate on Hong Kong outflow/liquidity will remain active and the data points for September (and beyond) critical in shaping the same.”
In August, foreign currency deposits in domestic and international banks operating in Singapore increased to US$9.3 billion (almost S$13 billion), as preliminary data from the Monetary Authority of Singapore showed. Data for July and August showed a a 64 percent increase in a span of two months, for a total of S$5 billion.
The situation in Hong Kong is unlikely to settle down anytime soon. On Saturday, October 5, the country’s Chief Executive Carrie Lam called for the public to condemn the increasingly violent protests, which had erupted yet again on Friday night after a ban on wearing face masks at public assemblies had been announced.
Ms Lam appeared in a 5-minute video accompanied by 14 of Hong Kong’s chief’s officials, slamming protestors for what she termed as “outrageous” behavior on Friday night, when protesters set fire to a train and vandalized metro stations—which caused the whole system to close down on Saturday, crippling commuters in the area.
In the video Ms Lam said, “Horribly violent incidents took place in various districts in Hong Kong last night. The extreme acts of the masked rioters were shocking and the level of vandalism was unprecedented.
The extreme acts of the rioters brought dark hours to Hong Kong last night and half-paralysed society today. Everyone is worried, anxious and even in fear.”
The city has a strong Public Order Ordinance that was passed during rioting in 1967, which allows the government to set curfews and forbid public access to specific areas. Hong Kong also has the Emergency Regulations Ordinance of 1922, which lets the city’s chief executive to carry out “any regulations whatsoever” that would ensure public security. This Ordinance, which hasn’t been used in over fifty years, allows for property searches and seizures, snap arrests and censorship./ TISG