Major American banks have announced they will share a chunk of the hefty hotel charges their employees pay while quarantining on their return to Hong Kong, underscoring the city's importance as a financial hub.
Morgan Stanley, JPMorgan Chase & Co., and The Goldman Sachs Group Inc. will reimburse up to about US$5,000, in quarantine expenses for employees who return from a personal trip to the city that has faced criticism for currently having one of the strictest COVID-19 control strategies in the world. Some companies in other sectors have also announced similar plans.
"I think there's a bit of envy, specifically Singapore, that bankers there are able to travel. When you look at Hong Kong's quarantine rules ... you do feel that you suffer as a consequence, and businesses are much more likely to be diverted to Singapore as a consequence of that," said Andrea Randall, Hong Kong-based partner and employment lawyer at RPC, a law firm.
The big banks' nod to the strict policies in Hong Kong comes when the newly discovered omicron variant of the disease, first reported to the World Health Organization from South Africa, is forcing a rethink in countries that recently relaxed border controls. Singapore, Australia and New Zealand have allowed residents to travel more freely under a "live with COVID" strategy, though much of that relaxation could come undone if there is a global resurgence in infections.
"We continue to live through extraordinary times and recognize that in the Asia-Pacific region we have borne the additional burden of multiple lockdowns and some of the strictest quarantine measures in the world," read an internal memo from Goldman Sachs. "We hope that this subsidy will make it a little easier for you to reconnect with families and friends living overseas, or even just to enjoy a change of scenery and recharge during a holiday abroad."
RPC's Randall expects more companies to offer similar support as they strive to keep employees happy. "I think it does make a bit of a difference, particularly with junior bankers going away on holiday or business trips and being able to mitigate that aspect of the expense."
Hefty bill
Hong Kong currently requires between 14 to 21 days of quarantine upon entry from overseas, excluding mainland China, Taiwan or Macao. A stay at a designated quarantine hotel room can cost up to $465 per night for a non-suite room, according to the government's COVID-19 support website.
In contrast, rival asset management hub Singapore changed its approach, opening up the economy and welcoming business travel on the back of a high vaccination rate. As of Nov. 29, 96% of its eligible population had been fully vaccinated, and 26% of citizens have already received a third shot as a booster, according to government data.
The challenges of working and living in Hong Kong are fairly significant because people have been used to their extended family being able to visit them, said John Mullally, Hong Kong-based director at Robert Walters, a recruitment firm. "Especially in a post-pandemic world where the one thing that a lot of people took from COVID was how fragile life is and the importance of spending time with those who love and those who are closest to you."
The frustration may abate once the borders reopen, some experts said, as Hong Kong remains a gateway to mainland China, one of the most attractive growth markets in the world.
"The approach to COVID has created a strain on how Hong Kong is perceived as a financial hub, given how most jurisdictions, prior to the latest variant, have learned to adapt and live with the virus," said Abimanu Jeyakumar, Hong Kong-based North Asia head of Selby Jennings, a recruitment firm.
That being said, Hong Kong Exchanges and Clearing Ltd. CEO Nicolas Aguzin believes mainland China's capital markets will triple in size to US$100 trillion in the next 10 years and that Hong Kong is the gateway to bring international investors to the growth story of China, Jeyakumar noted. "Hong Kong remains a strong and needed financial hub."