Unlike Singapore, Hong Kong might be stuck with ‘zero Covid' even if it wants to open up

Asia's Tech News Daily

A health official stands guard at the entrance of a market in Singapore on October 9 to manage the flow of people in an attempt to curb the spread of Covid-19. Photo: AFP

It seems it is Hong Kong’s fate to always be compared with Shanghai to the north, and Singapore to the south.

Looking north, Shanghai is larger and more deeply embedded in the nation’s political and social fabric. Hong Kong has the freedom of manoeuvre that distance and a separate constitutional arrangement can bring.

Looking south, Singapore as a sovereign country is autonomous so can be more decisive and bold, but it lacks a proper hinterland. Hong Kong has to keep in mind national priorities while enjoying the benefit of backing from, and proximity to, the world’s second-largest economy.

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There can be swings and roundabouts in both directions according to the subject, and so it is with response to the Covid-19 pandemic. The mainland is applying a “zero-Covid” policy, with entry strictly controlled and a ferocious response to outbreaks backed by a thorough track and trace system.

As a result, the number of infections has been kept low. The economy has not been seriously damaged by being hermetically sealed off; international trade in goods can continue and the domestic economy is large and robust enough to prosper. It does not depend on large inflows of foreigners to thrive.

Hong Kong’s situation is different. It also has a zero-tolerance policy and has kept the number of Covid-19 infections and deaths commendably low. The economy did suffer a recession in 2019-20, but is now enjoying a recovery.

However, the domestic economy, by itself, is not large enough to sustain us in the longer term. Our strengths are in the financial and professional services we provide on a national, regional and global level.

These two sectors – as well as tourism, which used to be one of our major employers – depend on ease of movement for people. When even returning vaccinated residents are subject to a long quarantine period, our position as a regional business hub is bound to weaken.

Hong Kong’s proximity to the mainland is no advantage in terms of access at the moment. Hongkongers are considered outsiders for the purposes of immigration and health checks.

Thus, staff of a company based in Shanghai have reasonable access to business operations throughout China. Meanwhile, Hong Kong-based companies are in essentially the same boat as those from Singapore.

The government’s declared priority is to secure an open border with the mainland on both social and business grounds. This is understandable, but it will not be easy. We do not know for sure what conditions the central government will set for quarantine-free access, but one aspect is bound to be vaccination levels. Here is Hong Kong’s Achilles’ heel.

The mainland has administered more than 2.2 billion doses to its 1.4 billion people and achieved more than 75 per cent coverage. Singapore has achieved a similar result with 9.7 million jabs for its 5.6 million people. The equivalent numbers for Hong Kong are 8.8 million doses for 7.5 million people, giving rise to a full vaccination rate of around 64 per cent.

Moreover, the take-up rate of first vaccinations has dwindled to around 5,000 per day and is falling. At that speed, and in the absence of robust new initiatives, we are unlikely to reach 80 per cent coverage much before Christmas next year.

Many countries are beginning to accept the reality of Covid-19 and that we have to learn to live with it. This is a sensitive exercise as any degree of opening up is bound to carry a risk that the number of infections will rise, with consequent increases in the number of hospitalisations and deaths.

Notwithstanding these risks, several countries in Europe are moving in this direction. In our part of the world, the first mover is Singapore, whose strategy can best be described by the traditional Chinese expression of “crossing the river by feeling the stones”.

Singapore, our traditional competitor as regional business hub, has recognised that prolonged closure to international travel is negative for development of its economy. It is therefore prepared to move away from zero-Covid and accept the risks to public health, establishing travel bubbles with selected countries in whose virus containment measures it has confidence.

All Hong Kong’s efforts to establish similar travel bubbles – with Australia, New Zealand and Singapore, among others – have come to naught because of our ultracautious approach.

It is unlikely the mainland will change its policy any time soon. Observers have pointed to the Winter Olympics in February and even the next party congress in November 2022 as events Beijing wants to run smoothly with the virus still under control.

The questions that arise are whether Hong Kong’s autonomy stretches to the point that we could, if we wished, start to move away from zero-Covid and follow the trend to open up. Would Beijing still open its borders to us even if we adopted a different policy? Does the local administration have the appetite to adopt a different policy? Will we put all our eggs in the Greater Bay Area basket and risk losing our premier regional hub status?

Paradoxically, in the latter case, we would also lose some of our usefulness to the nation. These are tough choices – be one city among several in the Pearl River Delta or continue to fly the flag as a top location for regional headquarters. I would feel more confident if I couldn’t hear Singapore smacking its lips at the prospect of eating our lunch.

Mike Rowse is the CEO of Treloar Enterprises

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This article originally appeared on the South China Morning Post (www.scmp.com), the leading news media reporting on China and Asia.

Copyright (c) 2021. South China Morning Post Publishers Ltd. All rights reserved.

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