Singapore
Singapore Pixabay

The growing unrest in Hong Kong has made investors and companies to move their money elsewhere and are eyeing to invest in Singapore, which is more investor friendly and has no social unrest. The foreign exchange deposits into Singapore's banks have risen up sharply in the recent months and will continue doing so, until the crisis in Hong Kong is solved, which doesn't seem so at the moment.

Singapore is now the direct beneficiary of the unrest in Hong Kong and several bankers and wealth managers have confirmed to have received numerous queries from clients from Hong Kong to move their funds to Singapore, citing the unrest and turmoil erupting in the city. Goldman Sachs has estimated a whopping $4 billion loss to Hong Kong and all of that amount has been moved and deposited in Singapore. Hong Kong and Singapore are often seen as rivals for the role of Asia's premier financial hub and it looks like Singapore is slowly gaining its edge, all thanks to the unrest.

Hong Kong
Hong Kong protest YouTube grab

J.P. Morgan's co-head of Asia ex-Japan for financials research, Harsh Modi, said "We can't be conclusive that there is a shift from Hong Kong to Singapore," and stated that he's seen deposits flow from Hog Kong to Singapore, as the protests show no sign of slowing down. "But yes, Singapore banking system — FX deposits have been going up quite sharply in the last two, three months. It is fair to expect that there is a shift in asset flows from the financial sector. Ultimately what we're apparently thinking about is which financial center in Asia is truly the international abode for capital. Is it Hong Kong, is it Singapore?'' he told CNBC.

Harsh Modi in his personal opinion, said that Singapore makes a lot of sense to safely place investors money. "My sense is, if you talk to a lot of people, it looks like it is more Singapore. The flow from what we see right now appears to be more in favor of Singapore.'' Preliminary data shows that Hong Kong has slipped into a recession for the first time in 10 years and if the protests carry on for a longer period of time, it would be a financial death knell as more and more investors would move out and invest in other stable countries.