Cracks are starting to appear in Hong Kong’s status as Asia’s financial hub.
As protests continue to rage on over a now-withdrawn bill that would allow Hong Kong residents to be extradited to mainland China, the economy has suffered. Retail sales in the city have slumped and tourists are staying away, and the impact of the skirmish on Hong Kong’s economy has prompted some economists to warn of a recession.
Now, the financial industry, part of the bedrock of the city’s economy, has shown some early signs of discomfort.
Whether it’s putting work trips on hold, cancelling events, or more people in the financial industry in Hong Kong looking to transfer out, it seems jitters about the protests, which began to pick up steam in June, have begun to seep into the high-rise office buildings.
One banker who declined to be named said Singapore clients at one bank cancelled business trips to Hong Kong, opting to do video calls instead. Hong Kong’s international airport has already been a target of protesters twice.
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There are signs the financial world is anxious. Banks including Standard Chartered and HSBC have joined Hong Kong’s richest man, Li Ka-shing, in taking out full-page advertisements in local papers urging calm among demonstrators. And real estate in the area has been suffering, according to media reports.
Jeanne Branthover, global leader of financial services at recruiter DHR International, told Business Insider that within the last three weeks she’s started to see a pullback from Hong Kong, between workers looking to leave and businesses moving out of the area, that could be an early sign of the area losing its grip on its status as Asia’s financial hub. She did not cite specific businesses.
“I think it is a combination of uncertainty as far as the world and China, and on top of this all the protests,” Branthover said. “The atmosphere is people thinking about leaving, and people not investing in the area.”
Branthover said one recent senior placement she made at a bank in Hong Kong was let go after the firm announced plans to shift business out of Hong Kong.
One banker told Business Insider that private banks have been getting more inquiries from clients about moving accounts from Hong Kong to Singapore, a trend that has accelerated in step with mounting data security concerns about China’s potential access to sensitive information.
Meanwhile, events planned in the city have been put on hold, or outright cancelled. Data giant Bloomberg cancelled its summer party for its Hong Kong office, according to one source, and its new hire training was moved from Hong Kong to Singapore. The Hong Kong leg of its annual charity run, The Bloomberg Square Mile Relay, was also cancelled this year, according to its website.
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In some instances, finance employees are actually looking for ways out of the city. A second recruiter that declined to be named said they’ve already come across a handful of people at banks and hedge funds looking to leave. The source said the reason all were looking to relocate was specifically related to the protests.
“People have learned from the past — when they were surprised or waited thinking things were going to be ok —people have learned don’t do that,” Branthover said. “People have really learned if there is something that is uncertain, make sure your job is certain.”
To be sure, one other Hong Kong-based financial professional said they’ve noticed very little disruption to their day to day activities.
But Aaron Hantman, CEO at outsourced trading firm Tourmaline Partners, told Business Insider that recently, when hiring for open trader positions in his firm’s Sydney office, he saw an influx of Hong Kong applications.
“We have seen a notable increase in interest from candidates currently living in Hong Kong and looking to leave,” Hantman said. “Although very early on, this could be an indication of longer lasting impact on Hong Kong as a financial center.”