Carrie Lam hosted 200 business and political leaders for dim sum and cocktails at a Swiss ski resort late last week to reassure them that Hong Kong’s future is bright. It was a tough sell.
The city’s leader told the crowd gathered at the World Economic Forum in Davos that Hong Kong was still open for business, despite paralyzing protests and an economy in recession. She also said that officials back home were working to contain the coronavirus that’s killed more than two dozen people in China and infected hundreds of others. Hong Kong has identified two cases.
In a room decorated with gold candles and red Chinese lanterns for Lunar New Year, Lam said her government “will safeguard Hong Kong’s fundamentals, including the rule of law.” She was also “fully confident of the city’s future,” according to a readout from her office.
Joining about 30 government officials at the “Hong Kong Night” in Davos were heads of the city’s stock exchange, airport and mass transit train operator. The chairmen of conglomerates Swire Pacific and Far East Consortium International also spoke at the event held in a restaurant overlooking the Alps.
Lam’s overseas charm offensive had already included a splashy marketing and ad campaign in global media outlets. At Davos, she gave a series of television interviews and also met the prime ministers of Luxembourg, Singapore and the Netherlands, as well as the heads of the International Monetary Fund and Julius Baer Group.
“Ultimately to take Hong Kong out of the economic difficulties requires first of all stability,” she told Bloomberg Television. “Secondly it’s an early restoration of law and order, and thirdly it’s continued government investment in important sectors – for example, innovation and technology.”
Not everyone was buying what Lam was selling. Yuan Ding, vice president of China Europe International Business School and a Davos delegate, said it was unclear what power Lam had to make critical decisions that could end the unrest that began last June.
“The effort made by Carrie Lam and the Hong Kong delegates here to assure the international business community will not work – they are merely putting on a show,” he said. “Foreign investors also don’t buy this.”
Moody’s downgraded the credit rating of Hong Kong on Monday, citing the “absence of an effective response by Hong Kong’s executive and legislative branches of government.” The Hong Kong government rejected that assessment, saying the downgrade ignored the city’s strong fundamentals. A lower rating could give lead to higher business and government borrowing costs, and follows a similar downgrade by Fitch Ratings.
Rumors have persisted for months that Beijing may replace Lam, whose approval rating is hovering near a record low of 14%, according to a Hong Kong Public Opinion Program survey. Lam told Bloomberg she would do her “utmost to stay in this position to help arrest the current situation.”
Chinese President Xi Jinping has so far maintained his support for Lam, despite Beijing replacing its main representative in Hong Kong with an official who quickly called for enacting controversial national security legislation.
“When it comes to modern communications, whatever your product – a mobile, a dishwasher, a city and its governance –- the claims you’re making about it have to be able to withstand scrutiny,” said Marc Sparrow, general manager of Hoffman Agency, a global public relations firm, in Hong Kong. “It’s open to question whether Carrie Lam’s Davos comments pass this test.” Shelly Banjo & Dandan Li, Bloomberg
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