A former chief economist of the Bank of Communications, Law Ka-chung, has warned that some of the analysis and information offered by officials of state-owned banks may be misleading the market.
Law, who stepped down from his post in October after 14 years at the firm, said increasing censorship at the bank was one reason why he decided to quit.
He said there had been growing restrictions on him and others in the industry from delivering economic and financial views in an impartial manner, which could have had an adverse impact on the market’s health.
“The political pressure seems to have some impact on the impartiality of the economic and financial views to be delivered and the room for normal jobs getting done is smaller and smaller … it seems the penetration from the mainland is getting higher and higher … this seems to tell us that the traditional way that we work, the rule-based, fact-based kind of Western agreed norms are getting hurt”, he said.
For example, Law said he and others had been banned from sharing pessimistic views about the Chinese economy during the Sino-US trade spat.
He added that some analysts had denied that capital had been transferred away from Hong Kong as a result on the ongoing social unrest, saying that claim was simply not supported by facts and figures.
He added that he expects this censorship, which began after the 2014 Occupy protests, to worsen amid the current political crisis.
“This round, I do see the whole industry getting a kind of censorship or banned from talking to the media. These days, the Chinese firms, probably most if not all, are forbidden to take up any ad hoc interviews with the media," he said.
"That’s why you don’t see any comments on the market by them, especially those about the impact of the riots these days on the economic and financial outlook. Even the Hong Kong-based FIs [financial institutions] or even the foreign FIs, they might [be subject to] a kind of censorship in front of China”, he said.
Law added that the trend is likely to spread to other industries such as the media, research and the commercial sector.
“I think the strategy from the north side is to try to stop the mouth of everyone, try to forbid bad news”, he said.