Due to Hong Kong’s political upheaval, Japan has taken measures to boost Tokyo in becoming Asia’s top financial hub
The Japanese government has noticed weaknesses from Hong Kong’s political instability, leading to enforcement of measures that would strengthen Tokyo’s office property market, reported by South China Morning Post.
An announcement was made this month by the government that a financial services agency would be introduced to help supervise foreign asset managers from Hong Kong. A company has also been established there to provide consultations to firms considering relocating to Japan. Analysts say that this shouldn’t create any impact towards demand and prices of office properties.
As stated by Kenji Nakanishi, Japan’s vice finance minister, the country has the potential to be a global financial district, seeing Singapore’s new rules on foreign workers and China’s clampdown on Hong Kong.
However, experts are making comments on the matter. Nai Jia Lee, deputy director of the Institute of Real Estate and Urban Studies at the National University of Singapore (NUS), mentioned that for Japan’s efforts to come to fruition, it will take some time.
Associate professor of real estate and finance at the Chinese University of Hong Kong Maggie Hu added, “it will probably attract at most a small percentage of firms out of Hong Kong to Japan.”
Tokyo still accommodates mainly to domestic firms, language barriers haven’t been broken down yet, and it’s improbable that Japan will adopt a low-tax system like Hong Kong in the near future. Many conglomerates still favour Hong Kong’s developed capital markets.
Michael Makdad, the senior equity analyst at Morningstar Tokyo, discussed, “I don’t see Tokyo taking the spot in the way that New York is clearly the leader for the US market and London is clearly the leader for Europe.”
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