‘This does not make sense’: Hong Kong No 2 official Eric Chan slams Moody’s ‘smearing’ credit outlook downgrade

Hong Kong’s No 2 official has hit back at global ratings agency Moody’s Investors Service’s move to downgrade the credit outlook for the city, saying it is part of a United States-led smear campaign to curb China’s national development.

Chief Secretary Eric Chan Kwok-ki said on Thursday that it did not make sense to change the outlook to negative from stable over issues with mainland China’s economy.

“Everyone can tell that these ratings by foreign companies like Moody’s have always been smearing Hong Kong, in my opinion,” he told a radio programme.

“Everyone knows that the mainland economy has a big effect on a lot of countries, it trades with the entire world, not just Hong Kong. Are you going to downgrade the outlook for the rest of the world? This does not make sense.”

Eric Chan says Moody’s credit outlook downgrade is part of a smear campaign led by the US. Photo: Jonathan Wong

Chan added Western countries led by the US had always tried to tarnish the image of Hong Kong and the mainland to constrain the nation’s development.

Moody lowered the outlook on Wednesday, citing the city’s closer economic ties with the mainland and the erosion of its autonomy under the national security law.

Hong Kong hits back at ratings agency Moody’s over credit outlook downgrade

In the wake of the assessment, the city issued a strongly worded statement disagreeing with the changes, saying the agency had made “unfounded comments”.

The move on Wednesday followed a similar change by Moody’s on the outlook for Chinese sovereign bonds, also from stable to negative, on Tuesday.

Eric Chan has highlighted the importance of national security to Hong Kong. Photo: Sam Tsang

Highlighting the importance of national security to Hong Kong, Chan on Wednesday said: “If we cannot ensure our national security, like if we have thieves coming into our home to steal and snatch things every day, how can we possibly talk about economic development and improving people’s livelihood?”

He added the city remained attractive to multinational companies and overseas talent, despite the report, and noted that the government had received more than 180,000 applications through its various immigration schemes.

China ‘disappointed’ at Moody’s downgrade of sovereign bonds outlook to negative

“All of these specialists and talent, they are very knowledgeable and professional people, they have confidence in Hong Kong, so how could it be like the ratings by Moody’s?” he said.

Hong Kong has launched an all-out drive to attract talent following a wave of emigration and an exodus of expatriates after Beijing imposed the national security law in 2020 and authorities persisted with some of the world’s toughest Covid-19 curbs.

Authorities have since tried to woo talent by easing visa requirements and introducing various schemes, with efforts also taken to attract strategic companies to the city as well.

Executive Council member and lawmaker Jeffrey Lam Kin-fung said he strongly disagreed with Moody’s latest rating for Hong Kong and urged the agency to avoid judging the city with a jaundiced eye.

He said the local business community had been visiting various parts of the world to draw investments to the city. Economic and trade cooperation between Hong Kong and the Middle East had gradually yielded positive results, he added.

Additional reporting by Danny Mok


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