Joe Tsai has some reassurance for those who are worried about the future of Hong Kong — and his pal, Jack Ma.
The Alibaba (BABA) co-founder spoke out separately on both topics in an interview with CNBC on Tuesday.
He predicted that despite the pandemic, economic slump and geopolitical tension, “Hong Kong is going to be fine.”
“Since they instituted the national security law, everything is now stabilized,” said Tsai, referring to a controversial measure enacted in the city last year after months of historic mass protests. The law banned sedition, secession and subversion against Beijing, and allowed Chinese state security to operate in the territory.
Since then, scores of opposition activists have been arrested, schools have been ordered to remove critical books from their curricula, and authorities have largely restricted mass demonstrations.
Tsai, a billionaire businessman who has a home in Hong Kong, opened up about his experience during the crisis, saying that “in 2019, when people were protesting on the streets, I was actually afraid to walk onto the street.”
“I actually felt physically threatened with … these protesters,” added Tsai, who grew up in Taiwan.
Tsai now argues that despite its setbacks, Hong Kong still has many competitive advantages as a global business hub, from a low income tax rate to open markets.
“It’s a free market economy,” he said. “You put money into the Hong Kong Stock Exchange today … in Hong Kong dollars, tomorrow you can take it out in US dollars. There’s a free flow of capital.”
Hong Kong has long been seen as a vital business center connecting East and West. Even after the city’s handover from Britain to China in 1997, it retained its image for decades, helped by a pledge from Beijing to maintain its semi-autonomous status for 50 years from the date of the handover.
But more recently, its standing as an international gateway has been called into question, with “an unprecedented number of expatriates leaving or planning to leave the city over the past few years,” according to the American Chamber of Commerce in Hong Kong.
Earlier this year, the city was booted off an index of economic freedom that it used to lead, dealing another blow to its reputation. Hong Kong officials blasted the move at the time, saying that excluding the territory was “neither warranted nor justified.”
Hong Kong has also been facing difficulties in its vaccination drive, despite securing and making available millions of vaccines for free public use. About 26.3% of the city’s total population has received their first vaccine dose, compared to 52.6% of the US population, according to official data. Strict quarantine measures in the former British colony have also made international travel near impossible for many months.
In his interview, Tsai also shared an update on his business partner, fellow Alibaba co-founder Jack Ma, who has largely been out of the public eye after landing in hot water with regulators last year.
Ma angered Beijing last year after accusing authorities of stifling innovation, and blasting China’s banks for having a “pawn shop” mentality.
Since then, regulators have embarked on an unprecedented clampdown on tech companies in China, including Alibaba.
Asked about the matter, Tsai said that Ma was “lying low right now,” while taking up new hobbies such as painting.
“I talk to him every day … he’s actually doing very, very well,” he said. “I think you have to separate what’s happening to Jack and what’s happening to our business.”