The global renowned banking conglomerate HSBC has put to rest many rumors and apprehensions, finally after days of deliberation. Many considerations were made within the banks management in order to shift the bank's base to the top profit generating center of Hong Kong. Currently dubbed the future of finance and trade, Hong Kong is one of the top financial friendly nations in the world. Hong Kong has been one of the busiest port trading economies for a few decades now. Ever since the emancipation of Hong Kong by the British, the nation was handed over to China for political governance and stability.
The decision to stay
Even though Hong Kong has had its difference with the over-arching Chinese political system, it has still managed to become the financial capital of the east, giving New York and London a run for their money. Many firms seem to be moving towards Hong Kong in search of greener pastures, especially considering how convenient and business friendly the laws and taxation are. This seems to be exactly the contrary with regards to the London economic system. In the case of London, the securities and exchange commissions and the central bank of England have cracked down very hard on the once deregulated financial market.
The 2008 financial crisis was made possible due to the liberalization of the economy, by deregulating it under Prime Minister Gordon Brown. This enabled the easy spread and unfortunate occurrence of the recession which was one of the worst financial crisis since the Great Depression. In light of London cracking down hard by regulating the economy and companies, many financial firms seem to be shifting to the more lucrative and business-friendly Hong Kong. While many were speculating and considering moving to Hong Kong, HSBC finally made the decision to stay and continue business at the headquarters in London. This has strengthened London’s reputation as one of the major financial capitals in the world.
The reasons to stay
There have been additional worries of the United Kingdom’s potential exit from the European Union. In that case, depending on future decisions by the respective governments, there will be considerations made to allow some employees to shift base to Paris, however, unfortunately, there will be a large restructuring of the workforce, and some lay-offs could also be expected. Under the heavy pressure of the banking lobby, the finance minister of the UK, George Osborne has allowed a substantial relaxation of taxes levied on the major banks, HSBC being one of them.