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The Star
08-05-2025
- Business
- The Star
Trump's tariff chaos: top Hong Kong bra maker presses on to beat 90-day pause
It has been over a decade since some Hong Kong manufacturers, responding to the mainland's sweeping industrial upgrade and sensing rising US-China trade tensions, moved to set up factories overseas. Being nimble paid off, until President Donald Trump launched his barrage of tariffs on US trading partners as part of his 'America first' economic plan. In the first of a three-part series, the Post focuses on a global underwear maker that moved strategically early, only to navigate new disarray in world trade today. At a cluster of Hong Kong-owned factories in Thailand last week, more than 3,000 workers raced against time stitching and packing brassieres as quickly as they could to meet a sudden spike in demand from the United States. Kenneth Wong Kai-chi, managing director of the Top Form Group, said he received a flood of urgent requests from US clients wanting their shipments brought forward. Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team. They woke him in the middle of the night, asking for their orders to be rushed. Everyone wanted to speak with him directly, but there were too many inquiries and too few solutions. 'Who will pay the extra overtime wages? Who will pay the extra cost of flying in material from China? There are many unanswered questions,' he told the Post. His four factories in remote Mae Sot, almost 500km (310 miles) from Bangkok and on the border with Myanmar, increased production to churn out 15 million units of bras and intimate wear last year, before US President Donald Trump's array of tariffs created havoc for the company and its customers. Top Form is one of the world's largest makers of bras, underpants and sports underwear for brands such as Calvin Klein, Victoria's Secret, Wacoal, Warner's, Hanes, Marie Jo, PrimaDonna and others. It was among the first Hong Kong companies which responded to China's industrial upgrade and US-China trade tensions over a decade ago by opening factories outside the mainland, but the recent surge in orders was unlike anything it had experienced before. US clients were anxious to avoid hefty tariffs announced by Trump on US trading partners globally since his return to the White House in January, with China hit the hardest. He has slapped tariffs totalling 145 per cent on Chinese imports so far this year, making for an effective tariff rate of about 156 per cent. In a tit-for-tat series of actions, Beijing imposed tariffs of 125 per cent on all US goods, on top of earlier duties. According to the White House, China now faces tariffs of up to 245 per cent on certain goods. When Trump signed an executive order on April 2 imposing tariffs on numerous countries, he accused trading partners of having 'looted, pillaged, raped and plundered' the US through unfair practices. He fixed a 10 per cent baseline tariff for practically all trading partners, with many facing so-called reciprocal levies as high as 50 per cent. Then, on April 9, he ordered a 90-day pause on the levies announced only the week before. That prompted the flurry of calls to Top Form from American clients wanting their underwear orders delivered fast. Meeting demand would be no easy task, according to Wong. Trump's tariffs meant uncertainty and trouble ahead for the company and other Hong Kong manufacturers that had diversified production lines away from mainland China to avoid getting tangled in a trade war. 'If you want to sleep through the night, you need to sort out a longer-term solution to ensure that everything, including yarn, has to be sourced outside China,' Wong said. 'The reality is, most raw materials come from China. Even factories in Central America source materials from China. That's why China's raw material suppliers have always had good business, even during Covid-19.' Shake-up for 'China plus one' strategy When it comes to shopping for underwear, American women are likely to buy bras made outside the US, mainly in China and probably by Top Form. China was the biggest producer and exporter of bras to the US in terms of volume and value between 2021 and last year, well ahead of the second-largest, Vietnam, according to official US data. The other top producers were Indonesia, Bangladesh, Sri Lanka, Thailand, Honduras, Cambodia and the Dominican Republic. Together with China and Vietnam, they accounted for 95 per cent of all bras imported into the US last year. Trump has slapped a 36 per cent tariff on Thailand, 46 per cent on Vietnam, 32 per cent on Indonesia, 37 per cent on Bangladesh, 44 per cent on Sri Lanka and 49 per cent on Cambodia. Honduras and the Dominican Republic were spared. From at least a decade ago, many Hong Kong companies spread their production bases from the mainland to developing economies such as Thailand, Indonesia, Vietnam and Bangladesh. They adopted a 'China plus one' strategy, reducing reliance on China as their production base to hedge against the effects of geopolitics and rising costs. Then Trump arrived and, within the first 100 days of his new term, caused chaos in global trade dynamics with tariffs he hopes will reduce the US trade deficit, assert American interests and correct what he sees as unfair imbalances. 'These manufacturers have gone beyond 'China plus one' to 'China plus N', but still cannot escape tariffs,' said Steve Chuang Tzu-hsiung, chairman of the Federation of Hong Kong Industries, one of the city's largest business chambers. China shipped goods worth US$439 billion to the US last year, taking second spot behind Mexico, which sent goods worth US$506 billion, according to official US data. 'Obviously, the US knows how much they're buying from China and how deep-seated China's supply chain is, even though many Chinese manufacturers have moved out to developing countries,' Chuang said. Now those countries have also been hit with tariffs. 'The erratic tariff announcements by Trump have created an environment where it is impossible for anyone to do business,' Chuang said. 'Businesses are unsure if they will receive payment for shipped goods or if clients will retract their orders altogether because nobody knows what the tariff will end up being once the products arrive.' From Mong Kok outfit to global enterprise Trump's 90-day pause on implementing his tariffs provided temporary breathing space for companies such as Top Form and its US clients. Co-founded in 1963 by current chairman Eddie Wong Chung-chong, the company has grown from a small outfit in Mong Kok where workers toiled at 20 sewing machines to make bras for export. Today, it is regarded as a global leader in underwear design and manufacture, with factories on the mainland and in Thailand, Sri Lanka and Indonesia, a workforce of 5,700 and an annual revenue of HK$1.13 billion (US$145.8 million) last year. Its products are sold at between US$13 and US$100 apiece in the US, in the mid- to high-end segment of the market. The company is run by the chairman's sons – Kenneth Wong, the group's managing director, group CEO Kevin Wong Kai-chung and Keith Wong Kai-chun who focuses on sustainability issues. It moved its first factory from Hong Kong to the mainland in 1979. It was among the first Hong Kong manufacturers to shift some production lines to Southeast Asia between 2007 and 2012, when the mainland began discouraging labour-intensive, energy-consuming and polluting factories in favour of high-technology manufacturing. Another trigger for garment factories such as Top Form was the mainland's protracted trade tensions with the US and Europe in the mid-2000s over a quota regime for such goods. Factory bustles in remote Thai town In 2009, Top Form decided to open a factory in Mae Sot, a border town in western Thailand separated from Myanmar by the Moei River, with a large Myanmese population. A business contact had suggested Mae Sot when the company was looking for a self-contained, self-sufficient community with a stable supply and less competition for labour. Over the years, it added three more factories, and its workforce grew, supervised by managers from the US, Sri Lanka, Singapore, Bangladesh, India, China and Ethiopia. Today, Mae Sot is a bustling trading hub popular with Myanmese, who cross the river to buy daily necessities and travel elsewhere in Thailand. Off the beaten track for tourists, it attracts Myanmese who move with their families to work in factories run mainly by Thai companies. Top Form is among the very few foreign firms in Mae Sot. Its factories there are the company's core production hub, importing yarn mainly from the mainland to be woven, sewn into bras and packed for delivery, accounting for almost half the group's output. The recent sharp rise in demand put pressure on the Mae Sot production line, but Kenneth Wong could count on his employees – Myanmese people made up 90 per cent of the workforce and turnover is low. 'This is because many Myanmese migrant workers want to make ends meet and have a stable life,' he said. Despite the proximity to politically unstable Myanmar, he said the production base had remained peaceful. 'During Covid, I lived in the factory for three months to show support to workers. I could see the sky over a mountain range across the border with warlords' air warfare that looked like fireworks at night,' he said. Over the past couple of years, the Myanmar side of the border has been exposed as a notorious site for human trafficking and job scam farms. Large posters at the border carry prominent warnings about scams in Chinese, Thai and Burmese. In March, the area was also affected by the deadly earthquake that struck Myanmar. Long-time employee Michael Allen Lurer, the manufacturing director, said the cluster experienced shock waves from the 7.7 magnitude earthquake centred more than 800km away. 'When the quake took place, all the workers were evacuated to an open space, and many of them felt dizzy,' said the American who grew up in Hong Kong and studied in Beijing before joining Top Form in 1997 as a graduate trainee. Everyone returned to work about two hours later, after the structural integrity of the buildings was found to be intact. 'Cautious about US market now' Kenneth Wong said the ongoing US-China trade war had underlined the importance of spreading manufacturing activity to different jurisdictions. 'Among the considerations for the location of factories are a stable and abundant supply of labour, stable development of a country and the support of key infrastructure such as telecommunication and utilities,' he said. The group still has three major production facilities on the mainland, one in Longnan, in Jiangxi province, another in Nanhai, Foshan, and the third is in Shenzhen, which together account for over a fifth of the group's capacity this year. Products from the mainland factories are exported to non-US markets such as Europe, the Middle East, Africa, Australasia and within China. Despite the confusion and uncertainty resulting from Trump's tariff announcements, the company was pressing ahead with plans for its factories and products. Group CEO Kevin Wong said that given the volatility in global trade, Top Form was limiting any significant investments in capacity at its Indonesian factory for the next 12 months. The group aimed to make more use of bonding technology, which adheres fabric for seamless bras that do not need stitching. Another technology on three-dimensional laminated pads can ensure that bras do not lose their shape. Kevin Wong said the tariff chaos would dampen demand from consumers worried about rising inflation. 'Job security isn't the same as previously, and it is unclear if interest rates are going to be cut,' he said. 'We are cautious about the US market.' In more recent days, there have been reports of the US reaching out to China to discuss the tariff war, with Beijing responding cautiously. This development cannot happen soon enough for Rick Helfenbein, former chief of the Washington-based American Apparel & Footwear Association – a national business body representing 1,100 global brands, retailers and producers. He told the Post that China was 'the master craftsman and had the best raw materials and logistics [for shipping] to the US'. Noting that China, Vietnam, Bangladesh, India and Indonesia supplied more than three-fifths of apparel to the US but faced tariffs of between 26 per cent and 145 per cent, he said: 'This clearly doesn't work!' Some US retailers had asked for price concessions, others cancelled orders and some had scrambled to change their sources of supply. He expected the situation to get more worrying as the year-end fall and holiday seasons approached. 'Eventually retailers will run out of time to properly stock their shelves for the selling season,' he said. 'Right now, the fear level is quite high.' Helfenbein hoped good sense would prevail and countries would sit down to talk through their differences. 'China is critically important on both the raw material side and the finished goods side. Even a solid diversification plan is often heavily reliant on China inputs,' he said. 'To move a supply chain, it takes three to five years. This is nothing that can happen overnight or at the whim of tariffs.' More from South China Morning Post: For the latest news from the South China Morning Post download our mobile app. Copyright 2025.
Yahoo
25-04-2025
- Politics
- Yahoo
With Indo-Pacific undersea cables at risk, companies tout their tech
CHRISTCHURCH, New Zealand — Taiwanese authorities this month charged the Chinese captain of the cargo vessel Hong Tai 58 for damaging an underwater communications cable connecting Taiwan to the Penghu Islands near the Chinese coast. The legal move is a reminder that sabotage of vital seabed cables, which is notoriously difficult to prove, has firmly entered the canon of gray-zone tactics meant to find weak spots in an adversary's defenses. Taiwan's coast guard had detained Hong Tai 58, a Togolese-flagged cargo vessel crewed by Chinese sailors, in late February. A similar incident occurred north of Taiwan in January, but on that occasion a Hong Kong-owned commercial vessel was fingered as the culprit. Taiwan has reported five cases of seabed cable damage this year already, compared with just three each in 2023 and 2024. Taiwan's coast guard has created a blacklist of nearly 100 suspicious China-linked ships. Despite Beijing's denials, some observers believe such nefarious actions are part of China's coercive behavior towards Taiwan. During a House Armed Services Committee hearing in Washington earlier this month, for example, U.S. Sen. Jacky Rosen (D-Nev.) blasted China's 'reckless, coercive and aggressive activities,' singling out sabotage of undersea cables as a 'particularly alarming tactic.' At the same hearing, U.S. Navy Adm. Samuel Paparo, commander of Indo-Pacific Command (INDOPACOM), acknowledged attempts to sabotage undersea internet cables, particularly around Taiwan. Wew weeks after Taiwan seized Hong Tai 58, media revealed that the state-owned China Ship Scientific Research Center had patented a deep-sea device 'capable of severing the world's most fortified underwater communication or power lines.' One of China's priorities in major hostilities against Taiwan – such as a naval blockade or full-blown invasion – would be to isolate the island and interfere with civilian and military communications. In his testimony to U.S. lawmakers, Paparo proposed two countermeasures against Chinese sabotage of cables. The first is to penetrate the targeting chain through intelligence gathering, and then showing up with forces 'in the locations where they would be otherwise cutting those cables.' Second, Paparo added, is resilience. This encompasses redundant communication networks to ensure the information environment continues unabated, as well as the proliferation of multiple satellite constellations in low Earth orbit. Meanwhile, naval tech companies are sensing a new market for their equipment. Andy Keough, managing director of Saab Australia, said the company is well positioned to support governments in defending underwater infrastructure through its countermine portfolio. 'Our products play a crucial role in mine countermeasure solutions as well as the protection of critical undersea infrastructure, including pipelines and subsea cables, across the globe,' Keough said. Autonomous underwater vehicles, or AUVs for short, can monitor infrastructure, and seabed sensors can provide real-time maritime domain awareness. Developing the ability to quickly repair infrastructure or reroute communications is also important. For example, Saab's electric Work-Class Remote Operated Vehicle can operate at depths of 5,500m and is controlled via satellite link. For inspections and repairs, the company's Sabertooth AUV can act as a persistent underwater resident with the aid of a subsea docking station, said Keough. Elsewhere, the company Exail won a French military contract to design an AUV that can dive as deep as 6,000m to counteract seabed warfare. To be delivered in 2027, these vehicles have the ability to reprogram themselves mid-mission. For example, if one detected something suspicious, it could move into observation mode to watch what a given target is doing. Thales Australia hopes to attract new customers with its sensing equipment. Gavin Henry, of the company's undersea warfare unit, said Thales' Blue Sentry technology, with its thin-line towed array, can help find potential threats. 'This system employs a network of sophisticated sensors capable of detecting and tracking both surface and underwater contacts,' he said. Ross Babbage, CEO of Strategic Forum in Australia, argues the undersea threat to key infrastructure requires a layered, whole-of-nation approach. 'In conjunction with automatic identification systems on ships, you can make sure people are following the correct channels and their prescribed route, because they're only going to do these things if they deviate from their normal route,' he said. 'So there are bell ringers there to then target an asset to go and have a look.' Nations like Australia need to conduct surveillance and look for anomalies, Babbage said. 'If you can do that, then you can pinpoint those anomalies and start to put the heat on them before they do it, or certainly capture them after they've done it, as they've done in Europe, and deal with it on a diplomatic basis.' An Australian Defense Department spokesperson told Defense News the military has a range of capabilities to monitor and respond to threats to undersea communication cables. The Australian Defence Force works with other agencies specializing in cybersecurity to protect infrastructure, though much of that information is classified.
Japan Times
07-03-2025
- Business
- Japan Times
As Trump hails taking back of Panama Canal, Hong Kong Inc. walks tightrope
HONG KONG – Hong Kong's edge as a financial hub will erode further as the city becomes embroiled in China-U.S. tensions, with the flash sale of a Hong Kong-owned global ports business highlighting geopolitical volatility, executives and analysts said. The former British colony is caught in the eye of a storm between Beijing and Washington, underlined by the decision by conglomerate CK Hutchison, controlled by Hong Kong billionaire Li Ka-shing, to sell its ports network, including assets along the Panama Canal, to a U.S. consortium led by BlackRock. U.S. President Donald Trump, who claimed in January that the Panama Canal was being operated by a Chinese company, has hailed the deal.
Yahoo
06-03-2025
- Business
- Yahoo
Analysis-As Trump hails taking back of Panama Canal, Hong Kong Inc walks tightrope
By Clare Jim, James Pomfret and Anne Marie Roantree HONG KONG (Reuters) - Hong Kong's edge as a financial hub will erode further as the city becomes embroiled in China-U.S. tensions, with the flash sale of a Hong Kong-owned global ports business highlighting geopolitical volatility, executives and analysts said. The former British colony is caught in the eye of a storm between Beijing and Washington, underlined by the decision by conglomerate CK Hutchison, controlled by Hong Kong billionaire Li Ka-shing, to sell its ports network, including assets along the Panama Canal, to a U.S. consortium led by BlackRock. See for yourself — The Yodel is the go-to source for daily news, entertainment and feel-good stories. By signing up, you agree to our Terms and Privacy Policy. U.S. President Donald Trump, who claimed in January that the Panama Canal was being operated by a Chinese company, has hailed the deal. "The Trump administration is going to see that this you have to assume they're going to follow the same play book...(they) see this as a victory," Steven Okun, a senior adviser to financial and risk advisory Kroll, told Reuters. As the U.S. strives to contain its main global rival China on fronts including trade, shipping, technology and capital raising, a dozen business people, investors, lawyers, shipping executives and risk analysts who spoke to Reuters say this is bringing greater uncertainty and volatility to Hong Kong. Hong Kong firms have traditionally been seen as internationally-focused and independent of the Chinese state, reflecting the role of the former British colony as a freewheeling financial hub. "We have been constantly reviewing our business plan and discussing about our strategy because of the political tension," said an executive of a listed Hong Kong company who declined to be named given the sensitivity of the topic. "For example, do we still want to list our units in Hong Kong and is Hong Kong still attractive as a listing venue, because investors could draw a China connection," he told Reuters. Hong Kong has a separate rule of law from China and its own financial policy-making autonomy, but some lawyers, diplomats and business executives say that after China's imposition of a national security law in 2020, the city was essentially being viewed by the West as fully under the control of Beijing. This has hurt it economically and cast doubt on whether it is a jurisdiction separate from mainland China with global best practices, they said. Earlier this year, Hong Kong's Far East Consortium and Chow Tai Fook Enterprise, which owns a development with Star Entertainment, the embattled casino group in Brisbane, tried to buy Star out. If successful, the bid will be another test of regulators who view Hong Kong companies as Chinese. In 2018, Australia blocked a A$13 billion ($8.2 billion) takeover of the country's biggest gas pipeline company, APA Group, by CK Infrastructure, a unit of CK Hutchison, citing it would be against the national interest. 'LUMPED IN' "Hong Kong is being increasingly lumped in with China ... that's a fact," said a board member of a leading Hong Kong business family with interests locally and overseas, including retail and property. "To a degree, this has raised the complexity and cost in our business dealings. We have to live with this." According to a person with knowledge of the matter, CK Hutchison had initially tried to fight to keep its two main port businesses in Panama after Trump alleged the Panama Canal was under Chinese control. But later, Hutchison opted to cash out and mitigate longer term reputational risks. "People in the Hutch empire are running for cover," said the person with knowledge of the ports negotiations, who declined to be identified due to the sensitivity of the issue. "This is a nightmare situation and we've never dealt with anything like this before." This source added that CK Hutchison executives were in touch with officials in Beijing while the situation unfolded. CK Hutchison did not immediately respond to a request for comment. Co-managing director Frank Sixt said in a statement this week the ports transaction was "unrelated to recent political news reports." The Hong Kong government has said it has never interfered with the commercial operations of Hong Kong companies, and criticised U.S. officials for making what it said were unreasonable and distorted accusations regarding the operation of the Panama Canal. CAUGHT IN CROSSHAIRS "It's been politicised and weaponised," a senior Chinese government official said of the Trump administration's framing of Hutchison as a Chinese entity - something the firm has denied. "It's unfortunate and regrettable," the official told Reuters, declining to be identified. Others, including business executives and lawyers, agreed that Hong Kong is increasingly being viewed as similar to other Chinese cities, even though officials like the territory's financial secretary, Paul Chan, say the city remains a global hub for the free flow of capital, goods and people. "The market is based on expectations," said Vera Yuen, an economics lecturer with the University of Hong Kong business school. "The valuation (of Hong Kong) is based on what they (the world) think, not what you claim." Even ahead of the recent Trump administration pressure on Hutchison's Panama ports, some local firms with international reach had been drawing up contingency plans to deal with growing U.S.-China strategic rivalry – and a growing sense Hong Kong would be in the crosshairs in a conflict. In 2023, Hong Kong-based conglomerate Swire Pacific sold its Swire Coca-Cola USA unit to its controlling shareholder, John Swire & Sons Ltd headquartered in the U.K., to protect the business so that it would no longer be seen as being held by a "Chinese company", two sources with knowledge of the matter said. A Hong Kong shipping firm executive described how his operation was already presenting its international posture in meetings with foreign investors. "The key is being as international as we can – our offices, domiciles and ships," the executive said. "We want to be able to show we are not really based anywhere." ($1 = 1.5780 Australian dollars) (Additional reporting by Greg Torode and Jessie Pang in Hong Kong; Scott Murdoch in Sydney and Beijing Newsroom; Writing by James Pomfret; Editing by Raju Gopalakrishnan)
Reuters
06-03-2025
- Business
- Reuters
As Trump hails taking back of Panama Canal, Hong Kong Inc walks tightrope
HONG KONG, March 6 (Reuters) - Hong Kong's edge as a financial hub will erode further as the city becomes embroiled in China-U.S. tensions, with the flash sale of a Hong Kong-owned global ports business highlighting geopolitical volatility, executives and analysts said. The former British colony is caught in the eye of a storm between Beijing and Washington, underlined by the decision by conglomerate CK Hutchison ( opens new tab, controlled by Hong Kong billionaire Li Ka-shing, to sell its ports network, including assets along the Panama Canal, to a U.S. consortium led by BlackRock. U.S. President Donald Trump, who claimed in January that the Panama Canal was being operated by a Chinese company, has hailed the deal. "The Trump administration is going to see that this you have to assume they're going to follow the same play book...(they) see this as a victory," Steven Okun, a senior adviser to financial and risk advisory Kroll, told Reuters. As the U.S. strives to contain its main global rival China on fronts including trade, shipping, technology and capital raising, a dozen business people, investors, lawyers, shipping executives and risk analysts who spoke to Reuters say this is bringing greater uncertainty and volatility to Hong Kong. Hong Kong firms have traditionally been seen as internationally-focused and independent of the Chinese state, reflecting the role of the former British colony as a freewheeling financial hub. "We have been constantly reviewing our business plan and discussing about our strategy because of the political tension," said an executive of a listed Hong Kong company who declined to be named given the sensitivity of the topic. "For example, do we still want to list our units in Hong Kong and is Hong Kong still attractive as a listing venue, because investors could draw a China connection," he told Reuters. Hong Kong has a separate rule of law from China and its own financial policy-making autonomy, but some lawyers, diplomats and business executives say that after China's imposition of a national security law in 2020, the city was essentially being viewed by the West as fully under the control of Beijing. This has hurt it economically and cast doubt on whether it is a jurisdiction separate from mainland China with global best practices, they said. Earlier this year, Hong Kong's Far East Consortium and Chow Tai Fook Enterprise, which owns a development with Star Entertainment, the embattled casino group in Brisbane, tried to buy Star out. If successful, the bid will be another test of regulators who view Hong Kong companies as Chinese. In 2018, Australia blocked a A$13 billion ($8.2 billion) takeover of the country's biggest gas pipeline company, APA Group ( opens new tab, by CK Infrastructure, a unit of CK Hutchison, citing it would be against the national interest. 'LUMPED IN' "Hong Kong is being increasingly lumped in with China ... that's a fact," said a board member of a leading Hong Kong business family with interests locally and overseas, including retail and property. "To a degree, this has raised the complexity and cost in our business dealings. We have to live with this." According to a person with knowledge of the matter, CK Hutchison had initially tried to fight to keep its two main port businesses in Panama after Trump alleged the Panama Canal was under Chinese control. But later, Hutchison opted to cash out and mitigate longer term reputational risks. "People in the Hutch empire are running for cover," said the person with knowledge of the ports negotiations, who declined to be identified due to the sensitivity of the issue. "This is a nightmare situation and we've never dealt with anything like this before." This source added that CK Hutchison executives were in touch with officials in Beijing while the situation unfolded. CK Hutchison did not immediately respond to a request for comment. Co-managing director Frank Sixt said in a statement this week the ports transaction was "unrelated to recent political news reports." The Hong Kong government has said it has never interfered with the commercial operations of Hong Kong companies, and criticised U.S. officials for making what it said were unreasonable and distorted accusations regarding the operation of the Panama Canal. CAUGHT IN CROSSHAIRS "It's been politicised and weaponised," a senior Chinese government official said of the Trump administration's framing of Hutchison as a Chinese entity - something the firm has denied. "It's unfortunate and regrettable," the official told Reuters, declining to be identified. Others, including business executives and lawyers, agreed that Hong Kong is increasingly being viewed as similar to other Chinese cities, even though officials like the territory's financial secretary, Paul Chan, say the city remains a global hub for the free flow of capital, goods and people. "The market is based on expectations," said Vera Yuen, an economics lecturer with the University of Hong Kong business school. "The valuation (of Hong Kong) is based on what they (the world) think, not what you claim." Even ahead of the recent Trump administration pressure on Hutchison's Panama ports, some local firms with international reach had been drawing up contingency plans to deal with growing U.S.-China strategic rivalry – and a growing sense Hong Kong would be in the crosshairs in a conflict. In 2023, Hong Kong-based conglomerate Swire Pacific ( opens new tab sold its Swire Coca-Cola USA unit to its controlling shareholder, John Swire & Sons Ltd headquartered in the U.K., to protect the business so that it would no longer be seen as being held by a "Chinese company", two sources with knowledge of the matter said. A Hong Kong shipping firm executive described how his operation was already presenting its international posture in meetings with foreign investors. "The key is being as international as we can – our offices, domiciles and ships," the executive said. "We want to be able to show we are not really based anywhere." ($1 = 1.5780 Australian dollars)
