Hong Kong’s Economy Shudders After Protests Plunge Airport Into Chaos


HONG KONG — Violence and disarray at Hong Kong’s airport have cast a fresh shadow over the territory’s status as a global financial and business capital.

Demonstrators largely retreated from the airport on Wednesday after two chaotic days in which hundreds of flights were canceled. Late Tuesday, protesters, police officers and passengers clashed in the same sleek terminals through which executives and financiers transit daily. But the anxiety created by the violence could linger, as businesses weigh their futures in a city once lauded for its stability.

“The airport is crucial, utterly crucial for Hong Kong,” said Tara Joseph, the president of the American Chamber of Commerce in Hong Kong. Business travelers, she said, have been canceling trips in significant numbers.

Many of Hong Kong’s most important industries — trade, finance, tourism — depend on ready access to the skies. If the antigovernment demonstrations this summer have tested the semiautonomous territory’s political union with China, then the airport disruptions have threatened something much more basic: the easy accessibility that makes Hong Kong such a valuable gateway to China for the rest of the world.

“People who didn’t have to come were starting to rethink their plans already,” Ms. Joseph said. The turmoil at the airport, she said, “is the icing on the cake.”

All sides in the unrest seemed to take a pause on Wednesday. Online, some protesters circulated apologies about the intensity of the violence at the airport the previous night.

The demonstrators proved they had the ability to paralyze an important economic artery, but the strong reaction that Tuesday’s chaos elicited from businesses, travelers and the mainland Chinese news media means that protesters may be more careful about trying such tactics again.

Some residents have started considering new contingency plans for their families and their wealth.

David S. Lesperance’s firm helps the ultra rich plan their tax and personal affairs to minimize legal and political risks. In earlier years, he said, perhaps one potential client from Hong Kong or mainland China contacted him every three months.

Lately, it has been three or four a week.

“People have gotten more pessimistic as events have picked up,” Mr. Lesperance said. “Now, instead of talking about it over drinks with their friends, they’re reading it in the newspapers. Now they’re looking out their windows at the crowds.”

Any major shifts by global companies could depend on whether large-scale protests continue in the coming months. Such changes take months, if not years, and Hong Kong still has major benefits that few other places in Asia can match, including proximity to China and a dependable legal system.

“It’s too simplistic to think that people will just pick up their suitcases and leave for Singapore,” said Ms. Joseph, the American chamber president.

In all, nearly 430,000 aircraft landed at or took off from Hong Kong International Airport last year, carrying almost 75 million passengers. A decade earlier, there were 300,000 aircraft and 47 million passengers.

“Left unaddressed, the closure of the airport would have seriously tarnished Hong Kong’s reputation and role as an air transport hub for the region,” the Hong Kong General Chamber of Commerce, a business group, said in a statement.

“We need to go back to business. We need to live our life,” said Davide De Rosa, the chairman of the European Chamber of Commerce in Hong Kong.

One factor that has potentially mitigated the economic impact is that the disruptions have not affected cargo flights. The Hong Kong airport handles 5.6 million tons of cargo a year, more than any other airport on the planet. But more airfreight is carried nowadays by wide-body passenger planes, and those shipments have invariably faced delays.

At the airport on Wednesday afternoon, Adrianne McKinnon was relieved to find that her flight to Toronto had not been canceled. Ms. McKinnon, 42, works in finance, and she said her primary concern after the latest violence was about how Beijing might react.

“You never know what China can do,” she said.

The protests in recent weeks have put a damper on commercial life across Hong Kong, leaving many neighborhoods eerily quiet at times when they would normally bustle with activity.

“Many people don’t dare to come out to the streets now,” said Lau Kwok Yiu, 50, who runs a small dessert shop in the North Point neighborhood, on the eastern side of Hong Kong Island.

Cathay’s shares have traded this week near their lowest value in a decade.

Given the pride that many people in Hong Kong feel for Cathay, the airline “is a sensitive point for China to apply pressure to,” said Peter Harbison, the chairman emeritus at CAPA Center for Aviation, a research firm.

“At the same time, it can be very quickly self-defeating,” he said. “I don’t think Beijing really does want to destroy all the good things about Hong Kong.”

Elsie Chen and Katherine Li contributed reporting.



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