Hong Kong leader has ‘piles of money’ at home after US sanctions

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The Hong Kong leader said she was forced to receive her salary in cash due to US sanctions, saying she did not have access to banking services despite the prevalence of mainland Chinese institutions in the city.

Carrie Lam, on whom the United States imposed sanctions alongside 14 other Chinese and Hong Kong officials for Beijing’s imposition of a national security law on the territory in June, said she had “a lot of money ”at home.

As part of these measures, the United States has threatened secondary sanctions against financial institutions that continue to deal with individuals, a potentially crippling prospect even for mainland Chinese banks because of their need to do business in dollars.

“Sitting in front of you is a general manager [of Hong Kong] which has no banking service. I use cash every day for all of these things, ”Ms. Lam said in a television interview on the Hong Kong International Business Channel.

“I have lots of money at home. The government pays me cash for my salary because I don’t have a bank account.

When the sanctions were announced, Hong Kong’s international and Chinese state-owned banks feared falling under a clause in the National Security Law prohibiting “collusion” with a foreign government to impose sanctions on Hong Kong.

But given the US dollar’s primacy in Swift’s global cross-border financial transaction system, analysts said institutions were forced to comply with Washington’s sanctions.

Ms Lam said it was “an honor” to be “unjustifiably sanctioned by the US government”.

Ms Lam’s office has been contacted to inquire whether she has also been denied accounts by Chinese state banks. His post entitles him to an annual salary of HK $ 5.2 million (US $ 672,000).

Bernard Chan, one of Ms Lam’s top advisers, told the Financial Times in July that an anonymous bank closed one of its accounts before the National Security Act was introduced because it was a “Politically exposed person”, and that it was becoming more difficult for Hong Kong officials to open accounts.

Companies operating in Hong Kong also complained that local authorities gave them insufficiently detailed answers on how to avoid prosecution under the National Security Act.

A government survey conducted between June and September recorded for the first time in 11 years a reduction in the number of foreign companies operating in Hong Kong. The survey found that 9,025 companies had offices in Hong Kong, up from 9,040 the year before.

Only 15% of businesses said they plan to expand in the city in 2020, while last year 23% expected expansion.

Businesses have also been spooked by anti-government protests in Hong Kong and the coronavirus pandemic, which many have cut off from their access to their operations in mainland China.

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