New Law Details Within Expectations: Finance Experts

Experts in the financial sector gave guarded welcome to the details of the new security law reported by the mainland’s state media, saying the markets have been expecting something like this and discounted chances of a huge cash outflow immediately.

Fred Hu, chairman of Primavera Capital Group, said if Beijing leaves the cases mostly to local courts, there won’t be much of a problem.

"It is reassuring that judges in Hong Kong will hear cases under the national security legislation. It isn't surprising that the National People's Congress retains the power to interpret the law,” he said.

"As long as the NPC refrains from interfering with the Hong Kong court decisions most of the time – that is, it chooses to intervene rarely in only exceptional cases - then the general public and the business community in Hong Kong should be just fine to live with the new national security legislation regime.”

"It seems the worst fears people have had about the (law) aren't validated, at least judging from the law's key features,” said Hu.

A senior banker in Hong Kong also said Beijing’s moves so far has been within his expectations.

"I don't see a lot in this right now. China's action was within expectation,” said , Ken Cheung, chief Asian FX strategist at Mizuho Bank in the city.

“More important now is the US reaction. At this point I think the impact is neutral,” he added.

Steven Leung, Hong Kong-based sales director at UOB Kay Hian said he doesn’t expect a sudden outflow of cash right now.

"We have been talking about this for some time now and despite the markets in Hong Kong have been quite stable.”

"We haven’t seen huge capital outflows. Hong Kong will remain a global financial centre, don't think that will change in the near term. In a way it's a good thing that the uncertainty around the law has gone now,” said Leung. (Reuters)