HSBC Holdings plc is reportedly planning to invest around USD 448 million in its China operations. The British multinational bank has claimed that while the economy is going through challenging times, it is also likely to emerge as a massive investment avenue in the coming years.
It is worth noting that with this investment move, one of the world's largest financial institutions will now own nearly 90% of its Chinese securities joint venture.
In this context, HSBC CEO Noel Quinn stated that the investment would be spread out over five years until 2025. However, the specific details of which divisions will receive the funds are yet to be revealed.
Following a lockdown that lasted for almost two months after observing a spike in COVID-19 cases in Shanghai, the city is now witnessing a sharp decline in cases once again. However, Quin cautioned that the Chinese economy is still far from recovering from its downturn.
According to sources, Shanghai officials have recently lifted the lockdown for all its 25 million residents on Wednesday, June 1st. For the time being, this relaxation has benefited some businesses, such as banks, which are permitted to begin operations gradually.
Quin added that the group anticipates some volatility in the market along with inflationary pressures in the short run because the lockdown has only just been raised, so the ambiguity caused by the pandemic will persist, and it will be some time before the businesses are back on the course.
Experts suggest that the Chinese economy has shown excellent persistence in the face of the virus's reemergence, and the country's long-term growth possibilities continue to stand. They believe that the attractive opportunities for foreign investors and businesses that fueled confidence in the country before the virus outbreak remain viable.
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https://www.channelnewsasia.com/business/hsbc-invest-3-billion-yuan-chinese-business-xinhua-2720151