Far East Asia is slowly but surely becoming quite a heated market especially after the bastion of commerce, Hong Kong had to go through months of protesting and a display of political issues.
The protests are still continuing as we speak as Hong Kongers continue to march in the streets to somehow win back the democracy they feel like they’re losing to China.
Although the extradition bill has been withdrawn, protesters want those responsible for it held accountable in the face of true democratic justice.
This means that the business owners that found refuge in the welcoming market of Hong Kong are still not able to breathe freely as the protests continue. Furthermore, they’ve become a bit more violent as the police refuse to hold back.
So much uncertainty is sure to make any business owner think of packing up and leaving. But where would they go?
Nearby markets are not good enough
The business opportunities that Hong Kong provides can easily be trumped by what’s available in China, but the fact is that business owners simply do not want to be under Chinese governance. Although it’s possible to profit heavily from the Chinese markets,
some laws tend to be a bit less agreeable than those present in Hong Kong.
But this is not a concern for only Hong Kong-based fintech companies though. Macau also seems to be taking hit after hit from Chinese lawmakers for having an immoral approach to economics.
According to an Australian wagering website,
Gunsbet.com the number of Chinese mainlander customers has grown over the years:
“When you ask a foreigner, they always think that the Chinese firewall has gotten stronger over the years when that’s not necessarily the case.
In the past, there was absolutely no way our website would have been accessed from mainland China because of it simply being blocked. Even VPN wasn’t enough to get through the firewall, but it seems the government is slowly but surely allowing the foreign
culture to seep within the borders.
Our number of mainlander customers has increased by around twice since last year alone, but all legally accessing from Hong Kong and later transferring to the mainland.
But looking at what’s been happening in Hong Kong in recent months, it’s unlikely that they will retain this freedom of access for much longer.
I don’t even think moving to nearby South-East Asian countries will be enough.”
Besides Australia, Hong Kong fintech companies have just a few choices they can make based on their surroundings.
They can either go to Taiwan which is also seriously being pressured by Chinese influence, or to South-East Asian countries where the market is definitely not as effective and the tax conditions are not even near as good as in Hong Kong.
Japan’s tax conditions are sometimes just too much for startups or small companies to handle and South Korea is simply too advanced to even remain competitive.
Therefore, the only natural and most potentially successful transfer would be to Australia as all the other options fail to meet the requirements.
Why is Australia a perfect choice?
The fintech scene is already quite developed in Australia, but not developed to a point where competition is simply impossible to beat.
There are a few payment providers that were based on the continent, but nothing significant enough to already dominate the global market.
When it comes to cryptocurrencies as well, and the blockchain, Australia comes across as a friendly jurisdiction, simply because they allow it to prosper and don’t necessarily have any preventative laws.
Add to that the
already migrating community from Hong Kong and you get an ideal scenario for any Hong Kong-based company to find not only affordable labor but affordable business conditions in the country.
Furthermore, they don’t necessarily have to register in a populous city like Sydney. Both Melbourne and Perth are enough for any large scale operations.
Skilled and expensive labor but cheaper real estate
Although labor is a bit more on the expensive side in Australia, around $4500 average monthly compared to Hong Kong’s $2500 average monthly, it’s at least a much better place in terms of real estate.
Hong Kong had a price of $28,000 per square meter while Australia has $10,000 on average. Doing a little bit of math shows that even though the labor is a bit on the expensive end for a new company, at least they’d be able to get their hands on some cheaper
real estate, ultimately breaking even on the decision.
However, for the price of that labor they get skilled developers, financial analysts and various other professions Aussies are famous for.
Furthermore, considering that they won’t have to face next to no political uncertainty is sure to be worth the extra price tag on labor.