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Letter from Hong Kong, 18th June 2021

Illustration: Perry Tse on SCMP

Fergus Herries, Associate Partner, Newgate Communications

Over the past few months Hong Kong has been struggling with the moribund adoption of the vaccine roll out scheme. This is now beginning to change with a concerted push from the private sector, most likely on behest of the Hong Kong government, offering a blend of carrot and stick.

Despite the fact that the government was quick to roll out a citywide scheme, which at full capacity would have already seen the whole eligible population vaccinated, the city stands at only 24% inoculation.

The problem has been a combination of mistrust of the government from the majority of Hongkongers, a lack of any tangible danger of community infection (for several months now Hong Kong has recorded fewer than 10 cases a day on average) and no perceived benefits for taking the vaccine – Hong Kong’s stringent quarantine regime means that even those vaccinated must stay in a government-approved hotel for at least two weeks following travel abroad.

The government has set itself the goal, led by Beijing and in common with many other regional countries, of chasing zero cases. This has turned into a self-defeating strategy. Having “won” the initial stages by controlling the outbreak and maintaining a relatively normal day to day life over the past year, jurisdictions like Hong Kong risk falling behind nations that have reopened borders and international travel. For a city that relies heavily on attracting international talent and visitors and acting as a regional hub for business, this has slowed economic recovery. The travel bubble with Singapore, which has a similar “zero case” fixation, has been delayed three times due to minor flare ups of cases on either side of the route. Few people hold much hope for it to be reinstated any time soon, no matter what the respective governments say.

Under pressure from the government and recognising the potential long-term damage to its own interests, the private sector has finally stepped in, recognising that in this town, money always talks. Through various private sector initiatives and some public partnerships, a total of HKD 180 million in prizes, ranging from cash incentives to flight tickets and even a lottery for a luxury flat from a major property developer, are now up for grabs for those who take the vaccine in short order. Unsurprisingly, this has spurred the vaccination rate. Some firms are even adopting the stick as well as the carrot – a major luxury Hong Kong hotel for instance has said that if the vaccination rate among its staff remains below 70% it will have to make some redundancies.

This sudden largesse from the private sector is unlikely to have developed completely independently, but will have been prompted by the government. It will however bring with it some concessions. The number one priority for business in Hong Kong is to have social distancing and travel measures relaxed, and the government has already relaxed quarantine measures but only for directors of listed entities – although the arrangement has been compared to “day release” from prison. Users of the scheme would have to return to their appointed quarantine hotel every night, with no deviation from an approved itinerary.

The city finds itself in a stand off – the government doesn’t want to relax measures until herd immunity has been reached, and Hongkongers aren’t prepared to embrace vaccinations, short term incentives aside, if the government continues to enforce onerous and potential long-term restrictions on travel. Politics, private enterprises and money have all entered the fray to break the impasse. Hong Kong’s future as an international finance hub could be jeopardised if it is unable to permit a freer state of travel for international business travellers and expatriate workers in the city, many of whom have been unable to visit overseas family members for nearly two years.

Hong Kong's leader Carrie Lam receives her vaccine. Only 24% of the population of Hong Kong have received theirs despite the programme being rolled out for several months

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