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  • Writer's pictureICMSS

Hong Kong's Financial Hub Paralyzed by Demonstrations

On Wednesday (12/6), hundreds of thousands of protesters filled the streets of Hong Kong as they oppose the amendment to the Hong Kong’s extradition law which was to be debated by lawmakers in a Legislative Council session this week. Overtime the impact of the protest are unpredictable, as for Thursday morning the situation had calmed down, but with little sign that either side will back down on the extradition bill, more protests are likely to arise. The extradition law stated that Hong Kong has agreements with some 20 countries to send over people wanted for certain crimes, and the proposed amendment would expand that list to include China and Taiwan. According to officials in Hong Kong, this was spurred by a murder case in which a Hong Kong resident admitted killing his girlfriend while in Taiwan. Although he was arrested, he has not faced trial because the current laws prevent him from being sent there.

The Hang Seng index ended the day 1.7% lower. Leading the sell-off were property companies like Wharf Real Estate Investment, which fell 5.4%, and New World Development, which declined 4.2%. On Thursday the Index fell below 27.000 level, which trimmed declined to less than 0.1% from as much as 1.8% after the government postponed the meeting to discuss the bill. By many estimates, the protests were eclipsing the massive protests in 2014 aimed at achieving greater democracy for the former British colony fizzled out in failure after more than 70 days of sit-ins. Those protests had helped damp stock market sentiment, causing the Hang Seng Index to fall about 2% during the period.