Hong Kong – The Next Safe Haven

The Capitalists will sell us the rope with which we will hang them. – Vladimir Ilyich Lenin

On 5 October 2022, Polish Prime Minister Mateusz Morawiecki said that Russian assets confiscated abroad should be used to rebuild Ukraine, in which Poland businesses will also partake. The objective is clear. Under the name of rebuilding, with Poland as one of the direct participants, countries and businesses will be able to get their hands on over $330 billion of assets. How much of it will be used for rebuilding purposes is not important.

Coincidentally on the same day, a US$497 million superyacht arrived in Hong Kong. The superyacht with the name Nord is believed to be owned by Alexei Mordashov, a steel and mining tycoon thought to be an ally of Russian President Vladimir Putin. I will skip the specifications of the boat here, but just know that it is one of the most impressive in the world.

After studying current affairs and politics, we realise that the world is always full of wonderful coincidences and beautiful friendships.

The arrival of the superyacht prompted the US to pressure Hong Kong into imposing sanctions on it. However Hong Kong have come up to say that they will not enforce sanctions imposed by the West, but instead will only be “implementing and enforcing fully the sanctions imposed by the United Nations Security Council”. This means to say that only after the UN Security Council approve the sanctions, that Hong Kong will comply. Just a gentle reminder here that China and Russia are both permanent members of the UN Security Council, each having the power to veto any proposed decision, regardless of international support. By this technicality, Hong Kong can confidently say without fear that it will comply to the UN’s decision whole-heartedly.

Money will always flow to those who are capable. To earn money, you do what others cannot or are unwilling to do. Switzerland has broken trust and is no longer as safe a place as people thought it would be. The superyacht to Hong Kong is just a test. A test for the next safe haven and to see how Hong Kong, the potential one, will react to Russia’s money in the face of overwhelming pressure.

If the superyacht finds safety in Hong Kong, then it is a signal to first the Russians, secondly to all the people around the world (except probably the Chinese themselves) that Hong Kong will be the next Switzerland. Unlike foreign funds who entered with the intention of a hostile takeover, such money can be considered friendly money. These are money by individuals who just want a safe place to stash away their wealth. Hong Kong has one more advantage that Switzerland does not have – the motherland’s ability and determination to guard the money peace.

With all that funds coming in, Hong Kong will go up another level as the next financial centre, this time leaving behind its closest competitor, Singapore. It also will provide an additional lifeline to Hong Kong and China in this unstable times. But whether Hong Kong is able to take this up will be open for all to see in another few days. Unlike what the US said, if Hong Kong manages to take care of this superyacht well, it will prove itself to be truly a financial centre worthy of everyone’s trust.