It was unveiled that British National (Overseas) passport issuances soared 8-fold to an all-time record just weeks after China's embassy to the U.K. made a statement about Sino-British financial cooperation and the need for the City of London to «cherish the hard-won achievements».

Hong Kongers are demonstrating an unprecedented desire to at least retain the option for emigration with a record-high BNO passport issuance of 154,218, according to an «SCMP» report that obtained data via a British government Freedom of Information Request. Renewals by the end of June this year had also reached 32,813 – the second-highest figures in 14 years.

There are currently an estimated 350,000 BNO passport holders – double since 2018’s 170,000 – and around 2.9 million total eligible applicants.

Sino-British Joint Declaration Broken?

The release of the figures is timely as it coincides with a recent decision by the City of London’s Court of Common Council which voted in favor of a motion (49 in favor; 29 against; and eight absentations) which formally accused Beijing of breaking the Sino-British agreement by denying Hong Kongers the promised right to a «high degree of autonomy» via implementation of the national security law (NSL).

The motion also supports government plans for a citizenship pathway for 2.9 million Hong Kong residents.

Chinese Embassy: Financial Coop at Risk?

In response, a spokesperson of China’s embassy to the U.K. denied the accusations that Beijing’s national security law for Hong Kong had broken the agreements, underling collaboration with the City of London, specifically with regards to financial cooperation.

«The Chinese side expresses grave concerns over and strong opposition to the motion passed by the Court of Common Council of the City of London, which makes unwarranted accusations against the National Security Law for Hong Kong SAR and interferes in Hong Kong affairs, which are China’s internal affairs,» a Chinese embassy spokesperson said in a statement.

«In recent years, the City of London has been committed to promoting sub-national exchanges and financial cooperation between China and the U.K. We hope that the City of London will cherish the hard-won achievements of China-U.K. cooperation.»

Three Points

According to the statement, the Chinese embassy hoped to underline three main points: firstly, claims that the security law violates the Sino-British Joint Declaration is a «false proposition» and that no country has «the right to use the Joint Declaration as an excuse to interfere in Hong Kong affairs».

Secondly, claims that the NSL undermines a high degree of autonomy is «pure slander». The statement said that the new legislation a means to plug «the legal loophole that had existed in Hong Kong for a long time» which is «conducive to upholding and improving ‘one country, two systems', protecting the rights and freedoms of the Hong Kong people, and safeguarding prosperity, stability and sustained security in Hong Kong».

Thirdly and finally, it accused the U.K. of interference and breaking its own promise by providing Hong Kongers the option to exit for British citizenship via BNO, citing a memorandum of understanding it claims includes an explicit pledge not to allow such privileges.

«Cherish the Hard-Won Achievements»

Despite the statement, a commentary by state-backed media «China Daily» said the motion had «no significant implication» and that it was «nothing more than a political show in support of the [Boris Johnson] government's deflective maneuvering», adding that it further «poisons» relations «which should otherwise have been enhanced to promote the two countries’ post-pandemic economic recovery».

«The City of London, as the central business district of London, should correct its politically-motivated decision and return to the right track of promoting exchanges and financial cooperation between China and the UK,» the report said, also echoing exact state comments to «cherish the hard-won achievements of Sino-British cooperation».

Cui Hongjian, director of the Department of European Studies at the China Institute of International Studies, said in a report by state media «Global Times», that London – the largest offshore yuan hub outside Asia – «wrongly hopes it can shoulder more financial business of Hong Kong whose role in the financial sector might have been missed after the national security law».

U.K.: Talent Inflow Boost?

finews.asia previously reported the rapidly growing interest for financial talent to seek alternatives outside of Hong Kong following the enactment of the NSL. U.K. was amongst the shortlist of potential substitutes and the BNO pathway for citizenship undoubtedly boost the ease of talent movement for the more than 100,000 financial workers in Hong Kong, most of which were born before the city’s 1997 handover to China from British rule.

Other alternatives that were named include Singapore, Taiwan and – due to tax reasons – mainland China.

U.K. currently has close financial sector ties with China which has recently reportedly accelerated global depository receipt sales efforts on the London bourse after NASDAQ tightened listing rules. Shanghai and London also have a cross-border stock trading channel though demand has been lackluster due to a limited offering.