Since the founding of Singapore, the country has been of strategic importance in the Asia-Pacific region, and a rival business hub to Hong Kong. The unrest in Hong Kong, compounded by the US-China trade war, has made Singapore an increasingly attractive destination for tourists, investors and expats.
Sumit Agarwal, professor of Finance, Economics and Real Estate at the National University of Singapore, is optimistic about the future of Singapore in light of the recent troubles in Hong Kong, CGTN.com reported.
“In the short run, we already know that Singapore is benefiting. We see people talk about the real estate market benefiting from it, people trying to buy property here from Hong Kong. We see that economically it is benefiting because trade will be rerouted. We see also financially the stock market is benefiting, people are looking to invest in Singapore,” said Agarwal.
The professor’s assessment — it’s now being called ‘The HK Bump” — has the backing of real data. The Singapore Tourism Board released numbers showing that occupancy rates in Singapore’s hotel were at a record 93.8% in July, the highest since 2005.
Some hoteliers in the city state are attributing the uptick to business conferences being relocated to Singapore from Hong Kong, where protesters have been taking to the streets throughout the summer.
Hong Kong has previously been known as the gateway to the Chinese mainland. Yet, the three months of unrest in the city has brought uncertainty to its markets.
This instability, coupled with an escalating trade war between China and the US, is forcing some international companies to rethink their Asian strategy, and is making some top talent think twice before relocating, the report said.
“What we are hearing from our clients is that they are doing business continuity planning around should they move their headquarters from Hong Kong to Singapore. What is their long-term strategy? What is the most stable environment for their business?” said Nick Lambe, managing director at Space Executive, a recruitment company with offices in Singapore and Hong Kong.
He continued, “From a talent perspective, there are individuals who will really think about whether Hong Kong is right for them at this point in time with the civil unrest that is going on.”
Although some believe that Singapore has great opportunities on the horizon in the wake of the Hong Kong unrest and the China-US trade war, the government is taking a more respectful and modest outlook.
Singapore Minister for Trade & Industry, Chan Chun Sing, said that Hong Kong is an important market and economic partner for Singapore and the increased uncertainty in the territory might have negative impacts on economies in the region, the report said.
As the unrest in Hong Kong shows no signs of abating, one thing for sure is that Singapore, as well as other regional economies, will be watching the developments in Hong Kong closely and trying to benefit from a stable and predictable operational environment.