The recent escalation of conflict in the Middle East has shattered long-held assumptions about the invulnerability of the region’s premier wealth hubs. For a decade, Dubai successfully marketed itself as a safe haven for the global elite, attracting vast capital flows drawn to its largely tax-free environment and perceived security. That aura of pristine security is now gone.
Even if peace is swiftly restored, the psychological impact will linger. For the globally mobile capitalist elite, the realisation that geopolitical risks can materialise even in carefully curated safe havens has underscored the urgent need for strategic diversification. Hong Kong is emerging not as a replacement for Dubai, but as its perfect complement.
I remain highly doubtful that there will be a true migration of wealthy individuals from Dubai to Hong Kong. The two cities offer vastly different lifestyles and the entrepreneurs who have built their lives in the United Arab Emirates are deeply invested in the region’s growth story. A wholesale relocation is simply not a realistic scenario. What we are witnessing instead is a sophisticated recalibration of risk: wealthy individuals and family offices looking to hedge their geopolitical exposure by booking a portion of their wealth through institutions regulated in a jurisdiction that is widely uncorrelated to Middle Eastern volatility.
Hong Kong is uniquely positioned for this role. Its foreign affairs stance, anchored within China’s broader diplomatic framework, offers a degree of geopolitical uncorrelation that is highly attractive. Its common law judicial system provides the regulatory certainty and structural familiarity that international capital demands. The absence of capital gains tax, estate tax and sales tax, coupled with the free flow of capital and deep, liquid markets, further cements its appeal.
The wealthy will not move to Hong Kong. But they will become clients of Hong Kong-based service providers who can cater to the needs of the globally mobile elite with advice, product design, asset management and legal structuring. Dubai remains a lifestyle choice; Hong Kong is a financial services choice. The two are complementary, not competing.
The current turbulence has made one thing abundantly clear: geopolitical hedging is no longer optional. Hong Kong stands ready.
Jean Claude Knebeler, equity partner and responsible officer, Admiralty Asset Management Limited
City must proactively secure essential resources
Since late February, the US-Israeli war on Iran has had a terrible human-induced impact on humanity and the planet, not to mention the civilian casualties, including vulnerable schoolchildren.
It is estimated that 5 million tonnes of carbon dioxide were released into the atmosphere in the first 14 days of the war. In addition to the numerous casualties, much of the infrastructure, including hospitals and schools, has been destroyed.
While no country can claim victory, all have suffered huge losses in many areas. The US spent over US$11.3 billion in the first six days of the war.
The national strategies of the US and China are very different. Top Chinese officials often make state visits to cultivate strategic alliances and collaboration that create mutual benefits. In contrast, Washington keeps creating conflicts and enemies by raising trade tariffs, abducting and killing state leaders, and coercing nations for land that does not belong to the US.
Around a month after the war began, the price of Brent crude oil had surged by more than 50 per cent, affecting almost all sectors and people worldwide. Countries have had to implement temporary controls to mitigate the negative impact.
On April 7, the Singaporean government announced a number of measures, including offering subsidies equivalent to HK$1,220 (US$156) to active platform workers and bringing forward the release of Community Development Council vouchers worth HK$3,070 for all households.
On March 23, the Chinese government introduced measures to limit the price of petrol and diesel to support businesses and citizens.
In this regard, as far as I can tell, the only aid offered by the Hong Kong government was the weekly publication of retail fuel prices after discounts offered by oil companies, starting on April 1. However, critics said this was simply inadequate. On April 9, the government proposed providing diesel subsidies to public and commercial vehicles and vessels, and related industries, and reducing tunnel tolls by half for commercial vehicles.
Why does our government only seem to react to escalating public pressure rather than itself considering the needs of the public, particularly during difficult times?
Senior officials should be reminded that it is their responsibility to ensure the security of the city’s essential resources, such as energy, water and food supplies, to protect us from highly probable future disruptions.
Edwin Lau Che-feng, Founder
The Green Earth