As Beijing tightens its grip, the city’s ambitions as Asia’s premier financial center face their most severe test since 1997
Hong Kong at the Economic Crossroads
Hong Kong enters 2026 carrying a set of contradictions that would challenge any financial center. Its bond market is booming. Its tourism numbers are recovering strongly. Its stock exchange has attracted a wave of Chinese technology listings. And yet, the institutional foundations that made it genuinely different from every other Chinese city – an independent judiciary, a free press, a government accountable to the people it governs – have been systematically undermined since 2020. The Financial Times, which has covered Hong Kong’s economic transition with rigorous skepticism, has raised these contradictions repeatedly in its reporting. The fundamental question the newspaper and its sources keep returning to is this: can a city that has lost its political freedom maintain the kind of institutional trust that financial markets ultimately depend on? The early evidence suggests that capital is more patient than activists about these matters. The US Chamber of Commerce in Hong Kong reported in early 2026 that 86 per cent of American companies surveyed viewed the city as a competitive international business hub, and 92 per cent had no immediate plans to relocate their headquarters. Beijing’s Foreign Ministry was quick to trumpet these figures as evidence of confidence in the city’s future.
The Numbers Behind the Narrative
The financial metrics that Beijing and the Hong Kong SAR government like to cite are not false. Hong Kong welcomed over 7.2 million visitors in the first weeks of 2026, up nearly 10 per cent year on year. The Hang Seng Index recovered strongly through 2025 after the shock of initial tariff announcements. Bond issuance in Hong Kong dollars and offshore yuan reached record levels. These are real numbers, and they represent real economic activity. But numbers do not tell the complete story of what a city is becoming. The number of independent media organizations still operating in Hong Kong has fallen from dozens to a handful. The Reporters Without Borders press freedom index has placed Hong Kong in the bottom third of its global rankings for consecutive years. The number of civil society organizations that once provided alternative sources of information and accountability has declined precipitously as groups disbanded under pressure from the National Security Law.
The Rule of Law Question
At the heart of Hong Kong’s financial credibility is the question of the rule of law. International businesses operating in Hong Kong have historically relied on a legal system that was genuinely independent of political pressure – courts that would enforce contracts, protect intellectual property, and adjudicate disputes without fear or favor. The Article 23 domestic security legislation passed in March 2024 has raised new concerns about how broadly security considerations could be applied to commercial activities. The legislation criminalizes “collusion with foreign forces” and “theft of state secrets” in terms broad enough to create genuine uncertainty for any business with significant international connections.
Democracy as a Market Signal
There is a case – not a comfortable case, but a real one – that the long-term health of Hong Kong’s economy depends on the restoration of political freedoms rather than their continued erosion. Financial centers throughout history have prospered in direct proportion to their reliability as neutral grounds where the rules apply equally to everyone. Transparency International’s Hong Kong corruption perception data still shows a relatively clean commercial environment, but the trajectory matters as much as the current snapshot. Every journalist imprisoned, every trade union dissolved, every election made meaningless reduces the stock of institutional trust that Hong Kong’s financial center has built over generations. That trust is not infinitely renewable. The city’s economic success in 2026 is real. But it is success being generated from capital accumulated under a different system, and the question that no bond prospectus and no tourism board statement can answer is how long that capital – financial and institutional – can sustain a city whose political foundations are being progressively hollowed out.
The Voices That Are Missing
Any honest assessment of Hong Kong’s economic future must grapple with the voices that are no longer permitted to contribute to that assessment publicly. The independent economists, the academic commentators, the investigative journalists, and the civil society advocates who once provided rigorous public scrutiny of government economic policy have been systematically marginalized. What remains is largely official narrative and corporate sentiment surveys. Both have their value. Neither provides the kind of critical accountability that a genuinely open society generates automatically. The city is being managed. It is not being governed in the full sense – with the consent of, and in dialogue with, the people whose futures depend on the choices being made. That deficit does not show up in bond market data. But it is real, and it matters.
The Talent That Left and What It Cost
Since 2020, an estimated 150,000 to 200,000 Hong Kongers have emigrated, many of them among the city’s most educated, entrepreneurial, and internationally connected residents. Their departure represents a form of capital outflow that does not appear in any bond market statistic but is deeply consequential for the city’s long-term competitiveness. The financial center can attract international capital. It cannot so easily replace the human capital it has lost – the lawyers, journalists, academics, and civil servants who built its institutions and who chose to leave rather than operate within a system they could no longer trust. That is the real cost of the political choices that have been made. It shows up not in spreads but in schools, newsrooms, and courtrooms that are quietly diminished. Human Rights Watch’s 2026 report on Hong Kong provides the most comprehensive annual accounting of the political and civil liberties situation that forms the backdrop to every assessment of the city’s financial future. Freedom House Hong Kong reports provide consistent long-term tracking of civil liberties that any analysis of the city’s financial future must consider.
Michelle Wong
International News & Human Rights Journalist, Apple Daily UK
Contact: michelle.wong@appledaily.uk
Michelle Wong is an international news and human rights journalist with experience covering cross-border issues, international advocacy, and global civil rights developments. She trained at a leading UK journalism institution, focusing on international reporting standards, source verification, and human rights frameworks.
Her reporting career includes contributions to Apple Daily and other liberal Chinese publications, covering international sanctions, asylum issues, transnational repression, and global human rights policy. Michelle’s work is grounded in primary sources, expert interviews, and international legal documentation.
She has worked in newsroom environments requiring careful coordination across regions and languages, giving her practical experience in verification and ethical reporting. Her authority is reinforced by consistent publication within reputable media organizations.
At Apple Daily UK, Michelle Wong delivers credible international journalism rooted in professional experience, subject-matter expertise, and adherence to global reporting standards.
