Security law 'not to affect financial hub status'

The proposed national security law for Hong Kong won't diminish international markets' confidence in the global financial hub, former Hong Kong Monetary Authority chief executive Joseph Yam Chi-kwong said on Thursday.

Yam, who is also a member of the Executive Council, said that ever since the decision to introduce national security legislation for Hong Kong was approved by the National People's Congress, the nation's top legislature, the inflow of capital into the city has been greater than the outflow, Yam said.

The Hang Seng Index saw a seven-day rally in early June, logging its best week since April 2015.

The phenomenon and the continued strengthening of the Hong Kong dollar is a message from the market saying that the matter is not a concern to the international financial markets, Yam said.

He made his remarks in a television interview that aired on Friday, a day after the draft law was submitted to the NPC Standing Committee for the first deliberation.

Late last month, in response to the planned national security law for Hong Kong, US President Donald Trump ordered a ban on allowing graduate students with ties to the Chinese military from enrolling in US universities. Meanwhile, the US Congress is considering legislation that would impose sanctions on certain Hong Kong banks and officials.

However, Yam said he believes the possibility of Chinese companies being restricted from using the US dollar as a medium of settlement, as many have speculated could happen, is low.

"Don't forget the United States is the world's biggest debtor nation. Will it impose restrictions on the world's biggest creditor on the use of the US dollar as a medium of transaction and doing business in its market?" Yam said.

Such a restriction would harm the US too, Yam said.

The proposed national security legislation for Hong Kong made Yam feel relieved, as he saw a chance to finally end the social unrest in Hong Kong.

However, some labor unions in Hong Kong plan to hold an online ballot on Saturday on whether to carry out a citywide strike in an attempt to derail the national security legislation.

The Chinese General Chamber of Commerce in a statement condemned the call for the strike "referendum", saying the "irresponsible act" is harmful to Hong Kong's development and will affect people's livelihoods.

Any strikes and class boycotts will deal a further blow to the city's economy, which has already been hard-hit by the COVID-19 pandemic, the statement said.

Hong Kong's seasonally adjusted unemployment between March and May increased to 5.9 percent, the highest in 15 years, according to the Census and Statistics Department.

Stressing Hong Kong is an inalienable part of China, the CGCC said safeguarding national security is the city's constitutional duty. The proposed law will plug the city's legal loophole to safeguard the national security and guarantee the city have a long-term stability and prosperity, the CGCC said.

Secretary for the Civil Service Patrick Nip Tak-kuen said on Friday that the "referendum" by labor unions, including the civil servant union, is against the political neutrality of civil servants and will "tarnish" the well-established reputation of the civil service.

In an open letter, he added that they are "the backbone of the government" and are expected to stand in solidarity with it, to discharge their mission and duty to safeguard national security in accordance with the law.