23 HKEAO NEW YORK
MIFT A
HONG KONG AS A FINANCIAL CENTRE : A NEW YORK PERSPECTIVE
This report outlines the general perception of Hong Kong as inancial centre in the wake of the worldwide stock market
Points will be crash in the second half of october, 1987. dealt with under four main headings: image, criticisms, damage and suggestions. A separate media survey (Appendix A) and the comments of our PR consultant, Gavin Anderson & Co, are at Appendices A and B respectively. In addition to analysing views expressed in the immediate aftermath of the crash, New York Office has drawn on comments taken over the past fortnight from bankers, investment brokers, fund managers and journalists.
Image
The
2. The accepted fact that Hong Kong was a domino which fell with other world markets in the chain of collapses from Wall Street down focusses the question not so much on why the Hong Kong market fell but rather on how the fall was handled, four-day market closure was an inevitable spotlight that attracted attention to Hong Kong disproportionate to its importance on the world stage.
3.
Though initially overshadowed by world events, it soon drew adverse comments from both the media and the informed public. Reasons given for the closure were generally treated with scepticism. There was an underlying feeling, strongly held in some quarters, that personal interests might have been involved.
4.
The negative light thrown on the Hong Kong Stock Exchange and its chairman also came in the wake of their visit to New York in September, which scored low marks as a public image exercise. Publicity about Ronald Li's involvement in the Club
Nor did his altercation with Volvo listing affair didn't help.
one of the journalists covering his press conference on the stocks slump which was extensively televised on newscasts and
His dual role as broker and reported on radio and in print.
Chairman of the Stock Exchange was questioned by many.
S. While the consensus is that Hong Kong's image has suffered, most professionals with an intimate knowledge of the Hong Kong financial markets believe that the damage is not irreparable. Much will depend on how the American economy develops and whether the leading world markets manage to stabilise over the coming months. They believe this period during which other markets are readjusting, offers Hong Kong an ideal opportunity in which to put its house in order and with the right mix of changes, repair its damaged credibility. Hong Kong's economy is seen as sufficiently strong to overcome short-term problems. 6. To put the affair into context, it must be appreciated that the Hong Kong market has always been regarded here as somewhat "cowboy" in essence, especially by the handful of Wall Street investment managers and professionals familiar with it. The closure did not really surprise them but they are nonetheless unhappy about it, if only for the fright it might have given its investment clients. These professionals have always taken
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