Hong Kong-EU cooperation still possible, ASEAN, Middle East not substitutes: outgoing diplomat

“Political changes and the general environment impact companies’ decisions about where to locate their operations. It is important to maintain Hong Kong’s uniqueness, both in the economic sphere and beyond the economic sphere.”

Hong Kong has been caught in the crossfire between China and the West in recent years, particularly after Beijing’s imposition of the national security law and the subsequent “patriots-only” election reshuffle, which effectively dismantled the city’s once vibrant opposition bloc.

Amid heightened geopolitical tensions, the local administration has shifted the city’s focus to emerging markets, particularly in the Middle East and the ten member countries of the Association of Southeast Asian Nations.

City Chief John Lee Ka-chiu will travel to Laos, Cambodia and Vietnam later this month, having already completed two trips to Southeast Asia and another to the United Arab Emirates and Saudi Arabia.

He has not visited any Western country, including those in Europe and the United States, where he has been sanctioned by the latter, since taking office.

The diplomat has said the recent launch of a multi-entry five-year permit for foreign nationals with permanent residency in Hong Kong to enter China via self-service clearance channels will facilitate travel. Photo: May Tse — The diplomat said the recent launch of a five-year multiple-entry permit for foreign nationals with permanent residency in Hong Kong to enter China through self-service screening channels would facilitate travel. Photo: May Tse

While it is “inevitable” that ties between the EU and Hong Kong will be affected in a complex geopolitical environment, Gnocchi said the “important” economic relationship enjoyed by both sides could not be replaced.

“It is normal for Hong Kong to have relations and economic ties with ASEAN. From our perspective, however, I think these two markets cannot replace the EU-Hong Kong relationship,” he said, citing figures such as the European Union being the second largest destination for local investment.

The diplomat added that there was significant scope for the two sides to work closely together, particularly in the area of sustainability, an area of EU expertise, as well as in good fiscal governance, green finance and green energy standards.

The EU office also plans to strengthen efforts to promote undergraduate and graduate programmes offered by European universities in English to Hong Kong people, he said.

Gnocchi said the number of European companies in the city had fallen by 3.5% in 2023 compared to the pre-pandemic level in 2019, compounded by the impact of Covid-19 and Political changes in Hong Kong.

The envoy stressed that the local government had paid strong and “overwhelming” attention to security, and he argued that there were other issues that could be addressed to improve the business environment, such as promoting LGBTQ Rights.

“Companies are happy to see that this can create a better environment for their employees. The government can send many positive factors and signals,” he said.

The diplomat has also expressed concerns over the decline in local stakeholders willing to meet with the EU office. Photo: Sun Yeung — The diplomat also expressed concern about the dwindling number of local actors willing to meet with the EU office. Photo: Sun Yeung

The EU High Representative said that the recent launch The introduction of a five-year multiple-entry permit for foreign nationals with permanent residence in Hong Kong to enter mainland China via self-service customs clearance channels would facilitate travel and make the city an attractive base, given that some Europeans have a regional role there.

He also hopes that China will extend its visa-free regime to all EU member states.

Looking back on his tenure in Hong Kong, Gnocchi said the EU office had a good working relationship with the city government despite differing views on some issues, and he was able to raise concerns while hearing explanations from the other side.

But he said there were fewer people in local civil society for the office to meet in Hong Kong’s reshaped political context, as some chose to act more cautiously or preferred not to engage.

“It’s a shame, because it’s an important part of our work,” he said, referring to his engagement with civil society as a way to complement information obtained through official channels.

“If it’s limited or restricted in some way, I think it has an impact.”

Gnocchi will leave the city next month after serving four years as deputy head of the EU delegation to Japan.

Harvey Rouse, currently head of the European Commission’s international relations unit, has been appointed to succeed him.