After China abruptly dropped its zero-Covid policies this month, Hong Kong quickly followed up on Tuesday, ending its “0+3” three-day medical surveillance regime for overseas arrivals, the last remaining Covid-related restriction on international travel after almost three years.
Discussions on reopening the city's border with mainland China are also back on the agenda, with officials on both sides sending the message that they are working towards relaxing China's “5+3” eight-day quarantine regime and restoring quarantine-free travel as soon as possible.
For overseas financial professionals and tourists alike, the end of 0+3 in Hong Kong means the city is almost back to a sort of pre-Covid normality, with no restrictions on restaurant dining during the three-day period after arrival.
Although arriving travellers must still undergo Covid testing and be fully vaccinated in order to be allowed into restaurants, those measures are all but certain to be dropped soon, given the city's high vaccination rate and relatively stable number of daily Covid cases.
RELAXING THE RULES
Meanwhile, despite Hong Kong's health chief on Tuesday denying media reports that a reopening of the border with mainland China could come as soon as early January, one thing is clear: The lifting of restrictions is happening more quickly than expected following China's hasty abandonment of its Covid control measures.
Besides cheering for the return of relative normality and the lifestyle Hongkongers used to enjoy, the question now is: Is the city ready?
When the restrictions are lifted – likely soon – cross-border business activity will resume, more people will come to Hong Kong, and the dust will be blown off the Greater Bay Area blueprint, in which the city's finance industry sees Hong Kong’s future.
Many policies and schemes have been announced or planned since before the pandemic, including extensive financial infrastructure development that includes mainland China, perhaps the most enthusiastically received being the Wealth Connect scheme, announced in late 2021.
However, actual transaction activity remains subdued. All parties are waiting for the border to reopen for deals to be struck, quotas to be assigned, and products to be approved.
Despite the fact that Covid policies still dominate news headlines in Hong Kong, government bodies and regulators should start shifting their focus back to economic growth and looking at policy implementation that could advance cross-border financial activity, such as the various connect schemes with mainland China and the new listing rules for specialist technology companies, so industry can draw up business roadmaps, budgets and hiring plans.
For Hong Kong’s finance industry, when mainland Chinese clients eventually return and international investors start to revisit the China market, companies will need to make sure they have the right workforce and other resources in place.
That will be a balancing act, because the extent to which international investors will pile back in remains unknown amid China's economic slowdown and uncertain policy environment.
Over the past year, Hong Kong's strict Covid control measures have seen the territory lose ground to Singapore and other cities when it comes to talent, international events, and even private wealth management business.
Although it's clear that the process of encouraging people and businesses to return will be gradual, it’s prudent to prepare sooner rather than later to recover the city's momentum.