In April 2022, record numbers of Hong Kong’s population headed for the exit as the city’s ever-changing COVID rules proved to be the final straw. In February, almost 1% of the population left the city—both expatriates and locals. It is not just the people who are leaving, a majority of international businesses are weighing their options about their level of presence in the city. This begs the question, where exactly are they going?
For many, the final push factor has come at a time when the city has one of the highest death rates per capita in the world—even worse than the US at its peak. As a result of the worsening wave, many Hong Kong residents feel frustrated with what some see as the Government’s lack of accountability, foresight, cohesive messages and arbitrarily enforced social distancing measures. Two years into the pandemic, with a readily available supply of vaccines and medications, Hong Kong citizens are still faced with a gruelling two-week quarantine upon return to the city. Parents are also increasingly concerned that their children’s well-being is not going to improve any time soon. Playgrounds remain closed and schools suspended, as the Government announced that it plans to move forward the summer holiday period to March until after Easter.
Though all departures may not be permanent, with some residents seeking refuge until the situation ameliorates, for now at least, there may be more viable alternatives to the financial hub that afford less restrictions for those who can are able to relocate.
Relocation choices
HSBC’s Expat Explorer Survey revealed that expats now rank Hong Kong 40th out of 46 locations worldwide, just above the Philippines, Russia and the UK, whilst rival regional hub Singapore made it into the Top 10 in terms of overall liveability. Despite expats in Asia feeling the most optimistic about the year ahead, the survey revealed a string of more appealing and viable choices for expats, ones that have minimal disruptions to normal life whilst featuring favourable tax and working conditions.
Singapore may seem the obvious first choice for both workers and businesses to migrate to as it remains well-connected to the Asia Pacific region and has a favourable business jurisdiction. For senior executives and skilled workers, it may be a viable option though, employment passes are increasingly difficult to obtain. Singapore has also not been without its own exodus problem, with the number of foreign workers falling to its lowest level since the 1950’s. Singapore, whilst an attractive business hub for companies wanting to retain a presence in the region and for expats wanting a similar quality of life to Hong Kong, may not have the same level of market maturity or deep pool of skilled talent as other locations.
One emerging location that has become increasingly popular is the Middle East. This strategic location, in the middle of Asia and Europe is ideal for both businesses and expats. HSBC’s survey also revealed that the MENAT region (Middle East, North Africa and Turkey) was the highest ranked region for quality of life. In the UAE, the Emirate of Dubai recently implemented a favourable remote working visa, which enables expats to live in the Emirate whilst working for businesses that are located elsewhere. This strategic move is ideal for businesses and expats seeking to capitalise on the fusion of the East with the West. Its time zones are also conducive to conducting business across both regions and travel—with both getaway and business related travel becoming much more viable.
For many expats, the desire to be closer to friends and family members after more than two years of forced separation is a top priority. At the top of the exodus list are the safe havens of Europe and Oceania. Switzerland, Australia and New Zealand are the top three liveable places for expats with the Channel Islands and rival gulf state Qatar rounding out the top 10. European locations such as Portugal, Greece and Cyprus offer lucrative ‘golden visa’ pathways and often hold favourable tax exemptions on foreign income, adding to their appeal.
Talent retention critical
For Hong Kong companies, retaining staff is more crucial than ever. With the whirlpool of talent departing combined with an increasingly turbulent talent market, companies should seek to be more flexible when it comes to their local and expatriate talent. Companies have spent years investing in their human capital and, should they remain inflexible, run the risk of operationally suffering in the short- to medium-term. By aiming to understand the mobility issues faced by their workforce, HR can seek viable alternatives to help ensure organisational longevity before talent starts walking out the door under their own steam. This could be an agreement to work for a company subsidiary in another location or to allow them to work remotely from a location with favourable remote work visas.
Paul Arkwright
Publisher
