Yahoo Finance Jim Armitage: Did HSBC and Standard Chartered really kowtow to Beijing over Hong Kong?
The Cambridge dictionary definition of “to kowtow” is specific: “to show too much respect to someone in authority”.
So, have HSBC and Standard Chartered really kowtowed to Beijing? Shown “too much” respect by approving its hideous imposition of Chinese security rules in Hong Kong?
Depends how you see it.
As multinationals headquartered in a country - the UK - whose prime minister has roundly condemned China’s actions; yes.
But in the real world, in which both firms rely enormously on both Hong Kong and China for their profits, the answer’s no. They showed the amount of respect needed to keep operating there.
Just look at the numbers. Standard’s Asian business is derived 61% from Hong Kong and 14% from China. HSBC’s Hong Kong revenue is 35% of its entire business, and that will only grow as it shifts further towards Asia.
HSBC - the Hong Kong and Shanghai Banking Corp - is known simply as “The Bank” by Hong Kongers. It, and Standard, are so local to the city that they are two of only three institutions allowed to issue banknotes there.
To stand against its Chinese overlords would have been commercial suicide. HSBC got a taster when it was accused of helping the US probe into Huawei (which it denies). Beijing went ballistic and reputedly withdrew some business.
If you want to make your money in China and, sadly, Hong Kong, you have to do whatever repellent Beijing orders. It’s a totalitarian state - that’s the way it works. There can be no such thing as too much respect.
