Growing uncertainty because of trade tensions between the United States and China as well as the recent unrest over a divisive extradition Bill have apparently given pause for thought for the wealthy in Hong Kong as well as foreign businesses.
A banking source in the territory said the super rich have begun to shift their assets elsewhere including to Singapore which, analysts said, is looking increasingly enticing to foreign businesses as the location for their headquarters and key staff.
But the sources said "the wealthy decision-makers are still in Hong Kong and China" and they still pay taxes in these two places.
The source also noted that "the final destination of the funds may not be Singapore" since it can be invested elsewhere.
Mr Brock Silvers, managing director of Shanghai-based Kaiyuan Capital, said it was "too soon" to gauge the depth of financial outflows from Hong Kong but agreed that Singapore should be a beneficiary if unrest continued to grip Hong Kong.
"Singapore's economy is free, the rule of law is strong, and it enjoys a high degree of social cohesion. Given its common cultural background, Singapore has a natural attraction for disaffected Hong Kong investors," he said.
Mr Sean King, a University of Notre Dame Liu Institute for Asia and Asian Studies Affiliated Scholar, said that Singapore would also gain in terms of attracting multinationals and the like.
"This latest crisis may have quietened down for now but it will, sooner or later, rear its ugly head again. Companies want certainty and want to be in a jurisdiction that makes its own decisions... Singapore thus makes sense," he told The Straits Times.
Echoing this, Mr Silvers said attention has been drawn to fears about China's legal system that many Hong Kongers describe as opaque and controlled by the Communist Party. Despite government assurances to the contrary, critics said the extradition law could be used for political persecution.
The suspension of the extradition Bill "won't completely eliminate this concern", Mr Silvers said.
"For companies that are now making growth, investment and location decisions, Carrie Lam has inadvertently but irrevocably placed her thumb on the scale in favour of Singapore," he added.
Meanwhile, former chief executive C.Y. Leung yesterday broke his silence over the divisive legislation and urged business chambers to send delegates overseas to explain the issue.
Posting on social media, he said that the incident has seriously damaged the city's international reputation and that it was not enough for Hong Kong to rely on Chinese embassies, trade offices based overseas or even international media to do "explanatory work".
Mr Leung, who is the vice-chairman of China's top political advisory body, wrote that many business chambers had accepted the Hong Kong's government's revised proposal on the Bill and were in the best position to comment on the issue.
