Mark Pinkstone/Former Chief Information Officer of HK government
Hong Kong’s Secretary for Justice Paul Lam Ting-kwok was correct in his assumption that the United States is determined to wreck the one-country, two-systems concept of a capitalist system operating under a communist regime. The success of the concept as it applies to Hong Kong is the cornerstone to China’s ultimate goal of regaining control of Taiwan.
On a Commercial Radio programme last week, Lam, who has been sanctioned by the US Department of State for simply doing his job – enforcing law and order in Hong Kong – criticized US President Donald Trump of “blurring the lines” by not recognizing Hong Kong as an independent founding member of the World Trade Organization (WTO) when imposing 145 per cent trade tariffs on China.
Hong Kong had a deficit trade balance with the US of US$21.9 billion in 2024. (US goods exports to Hong Kong in 2024 were $27.9 billion, while US goods imported from Hong Kong totalled $6.0 billion for the same period).
Yet, this was totally ignored by Trump when he lumped Hong Kong’s trade to that of the mainland when applying the tariffs to China.
Lam said that blurring the lines of the one country, two systems principle of governing by linking Hong Kong with the mainland when applying the tariffs was designed to “ make people think there was no difference” between the two.
Under the Sino-British Joint Declaration on the Question of Hong Kong, Paragraph 6 clearly states: “The Hong Kong Special Administration Region will retain the status of a free port and a separate customs territory.”
The Joint Declaration is an internationally recognized treaty between Britain and China and is registered with the United Nations. However, Trump chose not to recognize Hong Kong’s legality as a trading entity. He also tore up the United States-Hong Kong Policy Act of 1992, in which the US affords Hong Kong’s special status as a part of China and that agreements between the U.S. and Hong Kong that predated the 1997 handover would remain in effect.
For Donald Trump, treaties and agreements mean nothing, a hallmark of the Trump empire which will be remembered in future trade negotiations. All of the trade agreements made with countries throughout the world have been thrown to the wind as if they never existed.
Feeling the pinch is the American Chamber of Commerce in Hong Kong, which boasts some 2,000 members and is the largest AmCham outside the US. Noting that Hong Kong’s current predicament is “unfortunate,” it said that the US’s trade surplus with Hong Kong supported about 140,000 jobs in the US. In its latest newsletter, the chamber, giving full support for Hong Kong, said that “Hong Kong continues to uphold its status as a free port for the US and all other trading partners, not imposing tariffs on imports and not maintaining tariff rate quotas.”
Indeed, many members are impacted by the current turbulence and AmCham remains hopeful for a swift resolution to the current situation that will bring more economic prosperity to both sides of the Pacific Ocean.
In his radio programme, Lam said that the US has engaged in “transnational bullying” that is in complete violation of international relations and law. And he should know. Lam is a barrister-at-law, something Donald Trump is not.
Mark Pinkstone
** The blog article is the sole responsibility of the author and does not represent the position of our company. **
Hong Kong is facing a dilemma as more locals are spending their dollars outside of the city than what the visitors are bringing in.
Relaxed visa/permit restrictions for locals and foreign residents alike is making it easier for travel to the mainland while inbound traffic crossing the boundary is low budget and spending less on accommodation and food.
Tourism is an important pillar for Hong Kong’s economy. In pre-COVID times, tourism accounted for about four per cent of the territory’s Gross Domestic Product (GDP) and provided for about six per cent of total employment.
In Hong Kong’s heydays, the city saw about 65 million tourists in 2018, of which 51 million came from the mainland. It was boom time for retailers and restaurants. Long queues of mainland shoppers would line the streets along Canton Road and elsewhere waiting to buy luxury items from Gucci, Prada, Tiffany’s and other high-end stores which set up shop in Hong Kong to tap this lucrative market.
Today many restaurants and retail outlets are closing down, especially in the boundary towns of Sheung Shui and Yuen Long. The market is no longer there, and high rental costs make it almost impossible to survive.
During the 2025/2026 festive season, Hong Kong saw a 25.6 per cent rise in inbound trips on New Year’s Day 2026 (664,338 trips), but this was still countered by a massive 515,954 outbound exits on the same day.
Winston Yeung, chair of the Hong Kong Federation of Restaurants & Related Trades, told local media that business was sluggish during the Christmas holiday, with some restaurant owners calling it “the slowest business at Christmas over the past 10 years.”
Unfortunately, the local market is not propping up the tourism outlets. Instead, the locals are traveling in large numbers to Shenzhen and Macau and other parts of China for day trips or extended holidays, thereby providing a leakage in the local economy.
While Hong Kong received more than an estimated 45 million visitors last year, more than about 100 million departures were recorded by the Immigration Department of locals leaving Hong Kong by plane, train or bus mainly to the mainland (75 per cent), and to other major Asian destinations.
Hong Kong has 320 hotels offering 92,907 rooms, according to the Hong Kong Tourism Board. Despite mainlanders’ choice of more budget accommodation, occupancy rates for the hotel industry remained high at 88 per cent last year. The major hotels are not affected by the change in mainlanders’ preferences as they rely more on the affluent international tourist, visiting Hong Kong for business, conventions or holidays.
Property developer, Caldwell Banker Richard Ellis (CBRE) says Hong Kong’s hospitality market currently presents various investment-ready assets including rare investment opportunities for upper upscale and luxury hotels. These high-end properties are particularly attractive due to their resilience, as they are less reliant on Chinese group travelers and enjoy sustained spending power among affluent individual travelers and international visitors. This makes them attractive for investors seeking stable returns in a dynamic market.
To encourage locals to spend more at home and at the same time provide a bonus for tourists, Hong Kong has organised a series of mega events, many held in the new sports stadium on the site of the old Kai Tak airport in Kowloon. Traditional events in 2026 will include the French May Arts festival in March, Hong Kong Book Fair in July, Hong Kong performing Arts Expo in October, the World Snooker Grand Prix in February, and, of course, the international dragon boat races in June.
Blockbusters will include BlackPink World tour in January, the Hong Kong marathon, which draws in runners and their supports from around the world, and the Hong Kong Tennis Open also in January.
That is good for the inbound and outbound tourists alike. But more needs to be done to tip the tourism scales to a surplus for Hong Kong’s economy to grow at a faster pace. As the saying goes charity starts at home, so it is up to us as local residents who have reaped the benefits of the city to spend more in local restaurants and retail outlets than spend it elsewhere. Support local enterprises. After all, the restaurants in Hong Kong are ranked among the best in the world and are tax free as against a value-added tax applied to restaurants and shops in the mainland.
