15 December 2020

Why are UK banks siding with China?

By Chris Whitehouse

The battle for the future of Hong Kong has been fought on that city’s streets for months. The protestors who are calling for freedom and democracy have been violently repressed by Hong Kong’s police and governing authorities, and the situation has worsened since the draconian national security laws were imposed on the city.

Since their introduction in June 2020, the laws have been wielded as a stick with which to beat those associated with the Hong Kong protest movement. They are part of the Chinese government’s blatant attempts to dismantle Hong Kong’s autonomy.

But whilst there is a literal battle raging on the streets of Hong Kong, an adjacent battle is being fought in corporate boardrooms – and those that should have stood with the innocent and the oppressed, have instead sided with the oppressors.

Two of the most widely-used banks in the UK – HSBC and Standard Chartered – have voiced their support for the National Security Laws. Just this week, it was revealed that hundreds of senior employees at HSBC and Standard Chartered have been members of the Chinese Communist Party. HSBC also froze the accounts of several pro-democracy supporters and suspended the account of exiled Hong Kong politician Ted Hui. My friend, Lord Alton, wrote to HSBC Group Chairman Mark Tucker to express his concern at the bank’s actions but Mr Tucker glibly and dismissively wrote that “HSBC is required to obey the local law”.

HSBC has clearly decided which side its bread is buttered on, choosing the deep pockets of Beijing over those fighting for freedom in Hong Kong. Any right-minded individual would see Mr Tucker’s hand-wringing and shrug-of-the-shoulders as morally indefensible, but it is also potentially financially illogical.

HSBC has profited from operating in liberal market economies such as Britain’s and what used to be Hong Kong’s. But these open economies only work when operating in a free society and under the proper protection of the rule of law. Take these away and you remove the stable conditions that allow a bank such as HSBC to thrive.

HSBC also risks a growing backlash from its own customers – both here in the UK and around the world – who are sickened by the bank’s twisted moral positioning and the very real prospect of their customers deserting them for a rival.

I am proud to be working with the officers of the APPG on Hong Kong who are calling for more action from the British government to put pressure on the Hong Kong authorities, including by imposing Magnitsky-style sanctions against those most responsible for the brutal repression in the city.

But there are also other ways to bring about change, including by targeting those organisations that help to prop up the brutal Hong Kong and Chinese authorities. That is why we must do more to pressurise organisations like HSBC, Standard Chartered and any other company that stands on the wrong side of history. It’s not too late for HSBC to make amends and make clear that it truly stands with Hong Kong.

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Chris Whitehouse leads the public affairs agency, The Whitehouse Consultancy, and is secretary to the Parliamentary Group on Hong Kong.

Columns are the author's own opinion and do not necessarily reflect the views of CapX.