In an exclusive wide-ranging interview, Erik Bleekrode, head of insurance at KPMG China and Asia Pacific, tells Health & Protection about how international talent is returning to Hong Kong, whether comparisons to Singapore are valid and its role as a stepping stone for China.
Having spent most of the last decade in Hong Kong as an expat, KPMG China and Asia Pacific head of insurance Erik Bleekrode is well-versed in the special administrative region’s positioning within the global mobility market.
Bleekrode, who is originally from the Netherlands, took his first assignment as a seconded partner at KPMG Hong Kong in 2014 to 2016, before returning in 2017 as a partner for financial services audit, and then taking his current role in late 2019 just before the pandemic.
After the long-running disruption of the pandemic, he believes economic positivity and international talent is returning to the region.
“There is a general question globally around how the economy rebounds post-Covid,” he says.
“Purely from the Hong Kong perspective the region is open for business and in many ways is back to what it was, and is back to normal to the extent the world is back to normal.
“During the Covid years, quite a number of people left – not just foreigners, but also locals for various reasons and for various locations.“
Bleekrode notes that looking at the international population in Hong Kong, there are broadly two groups and these have responded differently.
“One is the short-term secondees that have been here for a few years and who have always been part of the Hong Kong employment landscape, and then there are foreigners who have been here for a long time,“ he explains.
“Some people that were here on secondment contracts were sometimes rotated back a little bit more quickly than they otherwise would have been.
“The biggest thing is that they haven’t been replaced with new people coming in, because there was no international traffic.
“But that is slowly coming back and there is definitely international talent coming back into Hong Kong again – because of the opportunity in the market.
“There were also people who have been here for a long time and decided that adding everything up on what happened on the back of Covid, they wanted to move closer to home, go back home or move somewhere else,“ he adds.
Returning from Singapore
Within the wider Asia-Pacific region, Hong Kong is often compared to Singapore as a destination and it did prove a draw for some people during the pandemic.
However now many of them are returning, as Bleekrode explains: “There have been people that thought Singapore would be more pleasant or easier to live than Hong Kong.
“Some of those are probably in the process of turning around and coming back again, because Singapore has become massively more expensive than it was before – because of the influx from other countries, rents have sort of doubled.
“So that makes life in Singapore much more expensive than it was and not necessarily more attractive – especially now that Hong Kong is coming back to what it was before.
“I wouldn’t say Singapore was a main destination, it was one of the destinations especially for people that left for personal reasons or business-related reasons, but a lot of people left for other countries as well – to places like the UK and Canada.
“But there’s always a lot of comparisons between Singapore and Hong Kong. They’re similar in some respects and very different in other respects.
“For example the whole proximity and relationship with China is a large differentiator between the two.”
Hong Kong is a stepping stone both to and from China
Though post-Covid, Hong Kong is still an attractive place to do business, especially to enter the China market, and the economy is getting back to normal, Bleekrode highlights.
“The general consensus and my personal view as well is that Hong Kong still has all of the unique features that it had pre-Covid,“ he says.
“Nothing of that has really changed; all of the macro economic benefits that it had – being close to China, a stepping stone to China, a free economy, a free currency, a strong and deep capital market, an international workforce with strong English and rule of law that allows businesses to thrive and prosper.
“There’s been a big impact over the course of Covid, because a lot of things have become a lot more complex globally.
“And obviously Hong Kong is dependent on international travel, international relationships and international flows of capital, but that is picking up.
“I won’t say it is back to normal, because the world isn’t back to normal, but institutionally that hasn’t changed.
“Some companies have moved people out, some companies have maybe chosen not to come to Hong Kong, but by and large in the bigger scheme of things, not that many – and all the big companies are here.
“Hong Kong is also an increasingly important stepping stone for those Chinese companies that want to interact with the rest of the world.”
Insurance law may impact large life insurers
One of the more notable changes in the insurance sector in Hong Kong this year has been the introduction of regulations on insurance risk management.
Encouragingly, like others, Bleekrode expects this will have minimal impact on the health insurance industry.
“By and large it will have no impact on the health insurance industry because its not geared for that,” he continues.
“It’s more to modernise the regulatory, solvency, supervisory regime and bring it closer to international models and the risk-based capital regimes in other countries that made that change earlier.
“That won’t make a difference for the health insurance industry because they are relatively capital-light products.“
But he adds that does not reduce the relevance of the health insurance sector and the focus it receives from a lot of insurers because it is a large part of their strategy.
“It’s more of a large part of the strategy for the local large life insurers that are all trying to grow their health insurance presence, or combine life insurance and health insurance in a better way.
“But it is not geared towards international visitors or locals that are travelling somewhere else – just purely here at the local population,“ he concludes.