May 27 - June 1, 2020
US sanctions unjustified
The Hong Kong Special Administrative Region (SAR) Government said (May 30) that sanctions or trade restrictions against Hong Kong are not justified and will break down the mutually beneficial Hong Kong-US relationship. In exercising its high degree of autonomy under “one country, two systems", the Hong Kong SAR Government is resolutely committed to upholding its international responsibilities and agreements with the US and all countries in areas such as trade, investment protection, mutual legal assistance, the fight against transnational crime and terrorism, as well as education and cultural exchanges. US's trade surplus with Hong Kong has been the biggest among all its trading partners, with merchandise trade surplus totalling US$297 billion from 2009 to 2018. Any change of US economic and trade policy towards Hong Kong would hurt local and US businesses alike in Hong Kong and the people working for them.

Responding to an earlier statement by the US Chamber of Commerce, a government spokesman also said (May 27) that the national security legislation only targets acts of secession, subverting state power, organizing and carrying out terrorist activities, as well as activities interfering with the internal affairs of the Hong Kong SAR by foreign or external forces. “The vast majority of law-abiding Hong Kong residents, including overseas investors, have nothing to fear,” the spokesman said. “All of the rights and freedoms enjoyed by Hong Kong people and international investors will remain unchanged .”
Open letter to Hong Kong citizens
Every country has its own laws to safeguard national security for the long-term security of their country and the stability of people's lives, said Chief Executive Carrie Lam in an open letter to Hong Kong citizens (May 29). Pointing out that the current legal system and enforcement mechanisms for Hong Kong to safeguard national security are inadequate or even "defenceless", Mrs Lam said the proposed legislation aims to enable Hong Kong society to find a way out of the impasse, restore stability as soon as possible and resume development of the economy and livelihoods. Speaking to the media on May 30, Secretary for Justice Teresa Cheng explained that as in any other country in the world, national security is a matter under the purview of the central authorities, whether it is a unitary or federal state. It is within the sovereign right of each state to pass relevant national security laws.
No change to currency peg
Hong Kong has no intention to change the linked exchange rate , which is backed by solid foreign exchange reserves and a sound banking system, said Financial Secretary Paul Chan (Jun 1), adding that Hong Kong has every determination to defend the linked exchange rate, first introduced in 1983. Mr Chan also said that the impact of possible additional tariff on goods manufactured in Hong Kong to the US would be limited because manufacturing only accounts for 1% of the city’s GDP and goods manufactured in Hong Kong exported to the US only accounted for 0.1% of total exports. The Financial Secretary said the Hong Kong SAR Government will not speculate on whether there could be additional measures imposed by the US. “On the one hand we (should) get ourselves prepared, we do the scenario analysis and the possible response planned by the Hong Kong SAR Government. On the other hand, we do not need to overreact to such possibilities,” he said.
Hong Kong financial system remains strong
The proposed national security legislation would not bring any changes to Hong Kong’s monetary and financial system , said Chief Executive of Hong Kong Monetary Authority (HKMA) Eddie Yue. The free flow of capital and free convertibility of the Hong Kong dollar will continue to be safeguarded, and the Linked Exchange Rate System, underpinned by strong foreign reserves position of over US$440 billion, will remain the bedrock of the city’s financial system. Hong Kong's banking system has strong capital positions, abundant liquidity, good asset quality and solid track record in operational resilience. Mr Yue pointed out that despite the recent volatility in the stock market, the Hong Kong dollar exchange rate has remained stable on the strong side of the convertibility zone and the financial markets have also been operating in a smooth and orderly manner. "The HKMA has the capability, resources and commitment to safeguard Hong Kong’s continued monetary and financial stability," he said.
Government hails financial partnership
The Hong Kong SAR Government welcomed the partnership of Hong Kong Exchanges and Clearing Limited and MSCI Limited to launch a suite of 37 MSCI Asia and Emerging Market equity index futures and options contracts on the Hong Kong Futures Exchange. “This partnership is a big step forward in developing Hong Kong into a pre-eminent risk management center and derivative hub, and represents a notable vote of confidence in the Hong Kong market,” said Financial Secretary Paul Chan.
Private clinics urged to step up testing
Noting that local infection cases have occurred sporadically, Under Secretary for Food & Health Dr Chui Tak-yi called on members of the public to seek medical advice as soon as they develop respiratory or mild symptoms, and proactively discuss with their doctors whether testing should be conducted. Separately, the Centre for Health Protection has again issued a letter to all medical practitioners and private hospitals to urge them to remain vigilant and offer COVID-19 testing for all patients presenting with any symptoms, irrespective of their travel history and clinical severity, in order not to miss the opportunity to identify infected persons in the community as early as possible. As of Jun 1, Hong Kong has recorded 1,087 confirmed cases.
Special flights for Hong Kong residents in Nepal
In light of the strict restrictions on all land and air traffic in Nepal since late March, the Hong Kong SAR Government has arranged for two special flights to bring Hong Kong residents stranded in Nepal back to Hong Kong. Upon arrival, all returnees will proceed to the Temporary Specimen Collection Centre at AsiaWorld-Expo for compulsory COVID-19 testing . After collection of deep throat saliva samples, they will then be transferred to the quarantine center for a 14-day mandatory quarantine period. The Government said it will continue to liaise with the Consulate-General of Nepal in Hong Kong and airlines to arrange other special flights to help stranded Hong Kong residents return home in batches.
  • The Hong Kong SAR Government recorded a deficit of US$2 billion in the month of April. Expenditure for the first month of the current financial year was at US$5.8 billion and revenue at US$3.7 billion. Fiscal reserves stood at US$146.6 billion.

  • Total assets of Hong Kong’s Exchange Fund amounted to US$525.1 billion as at April 30. This is US$179 million higher than that at the end of March 2020. Foreign current assets grew by US$8.6 billion while Hong Kong dollar assets fell by US$8.44 billion. Backing assets increased by 1.6%, to US$245.1 billion.
Basic Law online exhibition launched
An exhibition presenting the historical background, drafting, promulgation, and successful implementation of the Basic Law in Hong Kong was launched on May 30. Encouraging the public to visit the “Online Exhibition of the 30th Anniversary of the Promulgation of the Basic Law”, Chief Secretary for Administration Matthew Cheung said the exhibition looks back at the important milestones during the 30 years since the promulgation of the Basic Law and will deepen the understanding of the concept and implementation of the “one country, two systems” principle and the critical importance of the guarantee of the Basic Law towards the long-term development of Hong Kong. The public can visit the exhibition online .
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