2024 Chairman Geoffrey Siebengartner
Good afternoon, AmCham members and guests. And a special welcome to Regina Ip, the Convenor of the HKSAR Executive Council, and to United States Consul General Greg May, MFA Acting Commissioner Li Yongsheng for joining us here today; thank you both for your longstanding support for AmCham. And thank you all for joining us at our annual Chairman’s Priorities Luncheon, which we hold each January as the first act of the newly elected Chairman and to present our agenda for the year.
Actually, more appropriately, it should be called the Chamber Members’ Priorities Luncheon, since AmCham is a 100% private, member-supported, and member-driven organization. The work we do is largely planned and executed by our 16 sector-specific committees. In addition to those committees and our 2,000 members, we are fortunate to be guided by a very strong and dedicated board of governors, a wonderful team of full-time staff, and a president who is now well into his second year on the job.
Together, our mission is to serve the interests of member companies in the business community, to foster commerce, and to enhance Hong Kong’s role as an international business center. And I, too – like Eden – am delighted to be entering my second year on the job. I was honored to be re-elected in December to serve a second one-year term as AmCham Chairman. It is a privilege and I thank you for your trust.
I’d like to do three things – review last year, talk about priorities for this year, and answer any questions.
Review of 2023
Last January, I delivered my first priorities speech at the AmCham Hub, which is our home on Duddell Street in Central. Thinking back to this time last year, Hong Kong had just begun to re-open after COVID, and the Biden-Xi summit in Bali appeared to have stabilized U.S.-China relations. It was also about 3-4 months after Eden came on board as President to help us shape and execute a new strategic direction for AmCham, with an emphasis on re-engagement: with our local community and with officials in Hong Kong, Washington, and Beijing. We expected a year of re-opening and re-connecting with the world, and the consensus was that we had a lot to look forward to, not least a highly anticipated economic recovery in mainland China that would benefit Hong Kong and the global economy.
Obviously, a lot has happened since January 2023. As you know, much of the consensus from early last year was wrong. Unfortunately, we found ourselves facing the dual challenges of economic and geopolitical headwinds. Not only has economic recovery taken longer than we had hoped, but we also saw U.S.-China relations deteriorate during the course of the year. But, that volatility did not change our priorities, and despite various challenges in the external environment, I am pleased to report that AmCham had a successful year by several metrics (membership, events, and engagement/advocacy).
First, it was certainly a year for re-connecting. We worked hard at home in Hong Kong and traveled abroad to advocate for our members’ interests with key regulators and government stakeholders. For the first time in four years, we sent delegations to Washington and Beijing for a series of constructive dialogues – our so-called “doorknock” visits. In Beijing, we emphasized Hong Kong’s continuing important role as an inbound and outbound gateway, a hub for global business, and an essential feature of the developing Greater Bay Area economy. In Washington, we stressed Hong Kong’s value as an economic and strategic partner to the United States, and the optimal choice for Asia-Pacific based operations. In both capitals, we encouraged greater engagement, official visits, and business exchanges with Hong Kong. And we were pleased to see those visits begin, as we hosted a number of official and unofficial delegations in Hong Kong during the year.
Closer to home, I am very pleased with how much we have expanded our engagement with partners in the host government, both Hong Kong SAR officials and legislators, and also representatives of the Ministry of Foreign Affairs and Central Liaison Office. Frank, direct discussions are the best opportunities we have to build trusted relationships and to conduct constructive advocacy for members. Of course, we also engaged through formal channels like our submission to the CE’s Policy Address. And of course, we maintained regular – frequent – engagement with our partners at the U.S. Consulate, who continue to be good friends and close allies of the U.S. business community in Hong Kong.
Events & Programs
Second, Hong Kong’s reopening brought back in-person events. As many of you have experienced, events and programs are the primary way that AmCham shares knowledge, builds community, engages with stakeholders, and advocates for our members. In 2023, the Hub indeed was a hive of Chamber activity, on average with 2 to 3 programs per week. We held events ranging from the Women of Influence awards to the finale of the Onward Hong Kong Series, a two-day ESG conference, and closed-door meetings with a host of government officials and others, as well as business seminars and social gatherings.
We revived the famous AmCham Ball after a four-year hiatus. Not only is the ball possibly our most fun event, but it’s a great way for us to connect with the Five American Pillars – an important objective for me and for all of us at AmCham. I believe we had representatives from each pillar attend that evening. Our popular Future Leaders Program is now entering its fifth year. We also hosted joint programs with other chambers, like the Chinese General Chamber of Commerce, the Hong Kong General Chamber of Commerce, the Irish Chamber, the Korean Chamber, and the International Chamber of Commerce.
In September, we launched our bi-monthly e-Magazine, another platform for us to share information with our members. We have been seeing about 20,000 views per issue for the past three editions, and I would encourage you to take a look.
So, in summary, I can report that the Board of Governors in 2023, with almost 1/3 new members, was extremely active, the very lean staff transitioned to post-Covid work schedules without missing a beat, and our President worked closely with his team and Chamber members and the Board to craft an agenda that was meaningful, active, and provided real value to our members. All of this activity, of course, has the added benefit of putting AmCham on a path toward financial health as we work our way back from several years without in-person events and accordingly anemic revenues. We recognize that the economy has not returned to pre-Covid levels, and therefore I would like to especially thank our members and sponsors for their financial support and commitment that made 2023 such a productive and successful year.
So where does that leave us as we begin 2024? With two wars and half of the world voting during the year, geopolitics will remain a major source of volatility. Many view the U.S.-China relationship as stable for the moment, though not without continuing friction. The expected economy recovery, meanwhile, remains a challenge. Here in Hong Kong, what will be our priorities for the Chamber?
The first is continued engagement and advocacy. These are fundamental to what we do and become only more important during challenging times. You may have noted that our latest Business Sentiment Survey was just released two days ago. Our members, while still positive about business opportunities in Hong Kong and the U.S.-Hong Kong commercial relationship, continue to worry about geopolitical volatility and negative views of Hong Kong. AmCham members play a role, however small, in shaping views of Hong Kong by sharing an accurate picture of the current environment. We have a role to provide the objective facts that can sometimes offer a counter-narrative to views that might be overly negative. Those people-to-people discussions, with colleagues, with headquarters, and even here in our local community, seek to improve mutual understanding. We should continue to advocate to make sure that Hong Kong remains an international business city that is welcoming and inclusive, and that preserves the city’s essential strengths: the rule of law and an independent judiciary, freedom of expression, a vibrant and free press, the free flow of information, people, and capital, and the preservation of a vibrant international and multicultural society. In short, to maintain the unique one country, two systems framework that has been the foundation of much of Hong Kong’s success. This message has been central to our discussions with government officials throughout 2023, and will continue to be our focus this year. My expectation is that the environment in 2024 will make these messages more challenging than ever to deliver — and more important. We will see high-profile court cases, the introduction of Article 23, and perhaps a new law on cybersecurity. All of these will receive media attention that will affect views of Hong Kong and investor sentiment. We will be monitoring these developments and engaging with stakeholders to understand the facts and their implications for the business community.
Speaking of our Business Sentiments Survey, you may have seen the news yesterday after the results were released. Let me give you just a very brief summary of the findings, and you can read the details on our website. We thank the members who filled out this survey in the past two months, with approximately 130 individual businesses responding.
- First, despite a weaker than expected economy, members expressed the view that Hong Kong’s business environment stabilized, with 71% reporting an increase, or no change, in revenues (compared with 67% in 2022).
- 75% said they were optimistic/neutral in their business outlook for the next 12 months, and 28% planned to expand and invest in 2024.
- Respondents’ confidence in Hong Kong’s rule of law was stable. Members said they viewed that foreign businesses are welcomed/more welcomed in Hong Kong and that the SAR administration was effective in responding to business concerns and opportunities.
- Companies with regional/global headquarters in Hong Kong reported they had no plans to move their HQ away from the city.
- Members cited that Hong Kong remained an international business hub in Asia, with international connectivity, free flow of capital, taxation, the legal & regulatory system, as well as free flow of information/data being the competitive advantages that make Hong Kong stand out from other cities.
- However, members also shared their concerns. 26% were pessimistic about 2024 (compared to 14% last year).
- The reasons for this were varied: the US-China relationship remains a top business challenge, along with a weaker-than-expected Chinese economy and persistent negative overseas views of Hong Kong.
- Locally, the high cost of living (including housing), cost of doing business, and talent availability were serious concerns that members felt the government must address.
- The combination of all these worries implies that companies are adopting a “staying put” / “no change” / “wait and see” strategy for companies’ investments (60%) and hiring (56%) plans in Hong Kong in the next two years.
Looking at the numbers, the story you will see is that the business environment in 2023 was an improvement over 2022 (the final year of Covid restrictions), but of course did not meet the high expectations members had this time last year. And so this year we see a more cautious outlook for 2024, and a general posture of waiting out the volatility in the external environment and the Chinese and Hong Kong economy.
The survey results are one of the best tools we have for gauging member sentiment, and we will use the results to shape our engagement and advocacy in the coming year.
We will take these messages on at least one delegation to the GBA this year. We are already making plans to return to Washington this summer and Beijing later in the year. And we will again submit our Policy Address input for consideration by the Chief Executive in October.
Credibility & Trust
So, we intend to engage and advocate on behalf of members. We want our stakeholders to hear the point of view of the American business community. Our members don’t always agree with policymakers, so sometimes these can be difficult, frank conversations – some aspects of Covid policy are a good example. To deliver those messages and to be effective and impactful with our advocacy, we need to be credible and trusted as an organization. Credibility is our currency, whether we are in Hong Kong, Beijing, or Washington. That means, as I said before, trading in facts and being an objective, honest broker – whether we are speaking with our partners in the U.S. Government, the PRC government, or the HKSAR administration.
Now, AmCham has built itself since 1969 into the largest international chamber in Hong Kong and one of the most dynamic and influential international business organizations in the Asia-Pacific region. Our members employ around 140,000 people in Hong Kong, contributing to their livelihood, to the growth of our members, and to the Hong Kong economy. The business we do here (U.S.-Hong Kong trade) employs over 160,000 people in the United States. So we have the authority that comes with that kind of scale and impact.
Even so, the reason I mention credibility and trust is because, as I said, the coming year will be a challenge for views of Hong Kong. We already see this in the publicity surrounding Article 23. In the current environment, it will be more important than ever for us to be viewed as a trusted partner and voice of the business community, and to remain objective in what could be a charged environment. This is nothing new for us, but it is an area where we will remain acutely focused – being balanced and objective in our views and diligent and credible in our assessments of the business environment in Hong Kong. Not everyone will share our mission of seeking to foster commerce in Hong Kong, and some will disagree with our views. But we do intend to remain a trusted resource and an ally to anyone who wants to at least better understand the business environment in Hong Kong.
Events & Programs
Turning to events, the AmCham Ball will be back, by popular demand. I look forward to seeing you there, especially if you missed last year’s event. And our Women of Influence awards is now in its 20th year, so we are planning a really wonderful event to celebrate that milestone on March 8, International Women’s Day, with an afternoon summit followed by a gala awards dinner. In addition, given members’ focus on the Chinese economy, we will resume the very popular AmCham China Conference in April. For the first time since 2019, we will bring together experts to examine the current state of the Chinese economy, and to discuss the challenges and opportunities ahead. Meanwhile, throughout the year we expect to host what we hope is an increasing number of American and international visitors, both from business and government, as well as seminars and social gatherings organized by our industry committees. We held the first one two weeks ago with our AmCham-ASEAN Chambers Happy Hour. Which is a perfect example of engaging on our priorities – in this case, to support and encourage Hong Kong’s role as a gateway not only to China and the GBA, but also to the rest of the region and the world.
And, as an active pillar of the American community in Hong Kong, we will continue to explore new ways to work closely with all Five American Pillars – AmCham, the American Club, HKIS, the AWA, and the US Consulate.
I have mentioned committees a few times now and want to take a moment to emphasize the point. These groups really form the backbone of AmCham, where member participation drives activities that in turn ensure we are being responsive and useful to our membership, and of course drive revenue that make us self-sustaining. They are the ones who keep us focused on timely topics, and I’m sure will organize plenty of events for us to hear more about AI, sustainability, data and digital assets, and any number of hot business topics we need to track in 2024. Committees are also our succession plan – almost every current board member previously was active in a committee or served as a committee chair. We want to make sure this pipeline is full and that we have a deep bench of future AmCham leaders. We will be more focused this year on leveraging committees and developing that talent.
And, speaking of succession, one of my aims is to make sure that my successor can stand here next January and announce that we have overcome the drag of the Covid years and returned to a balanced budget in 2024! Admittedly that is what we call a stretch goal, but I know that our Board members will continue to be supportive, and the AmCham staff have really excelled at being lean and efficient – while providing value to our members every day. You can see it in our membership renewal rate, which is higher than ever, with new members joining at a good rate, too. In fact, I am very pleased to say that we have achieved the highest membership level in our long history. And with your help, I know we will have a good year financially and a great year continuing to make an impact on behalf of all our members in this wonderful city.
Our members embrace Hong Kong as a regional and international business hub, based on the central principles of free trade, open markets, and the rule of law. We will continue to engage and connect on behalf of members as a credible and trusted advocate of the Hong Kong business community. We will continue to face challenges, economic and geopolitical, but our event calendar is full as we focus on the issues that matter most for our members. I look forward to working with you all and intend to see you at events throughout the year. I wish all of you all success and prosperity in 2024, especially as we look ahead to the Year of the Dragon!
The Dragon is a mythical, auspicious, and supreme creature in the zodiac. If you know your Chinese mythology, Dragons have the power to control wind and rain, and rivers and seas, and in fact ended drought in China and to bring prosperity to the world. I think we can all use some of that this year!