Month: February 2022

It is by now common knowledge that the COVID pandemic put regulatory agencies in multiple countries under severe constraints, including delays due to staff working remotely and staffing shortages.  For example, the Chairman of the U.S. Securities and Exchange Commission (SEC), Gary Gensler, admitted that the SEC was short-staffed, with 4 to 5 percent fewer staff than five years ago.

In Hong Kong, the situation at the Hong Kong Securities and Futures Commission (SFC) has apparently been exacerbated by the severe COVID restrictions that the Hong Kong government has placed on the population.  The SFC reportedly lost 12 percent of its staff in 2021, compared with 5.1 per cent in 2020, and is finding it difficult to recruit new staff because of Hong Kong’s quarantine rules.  SFC Chairman Tim Lui stated that the SFC’s most serious shortages were in junior professional staffing, which declined by 25 percent, and that the shortages had “been compounded by the limited ability to import talent from outside Hong Kong.”

Because the competition for financial talent in Hong Kong “is keen”, Lui said that the SFC had to set aside more money to compete with the private sector for staff, and to give a 4.5 percent pay rise to the current staff.  The expected increase in SFC staff cost is HK$140.5 million (USD$18 million), which represents a 9.5 cent year-over-year increase.  Total staff costs were projected to be HK$1.6 billion for the 12 months starting in April 2022.

Even with the planned hiring increases, however, the SFC’s total headcount by the end of March 2023 is projected to be 1,018 — only 3 per cent more than current levels.  That modest increase appears unlikely to keep pace with the continuing vitality (even with COVID restrictions) of Hong Kong as an international financial center, and the projected growth of China’s capital market, for which Hong Kong will serve as a critical gateway, to $100 trillion.  The SFC can only hope that the Hong Kong Legislative Council, which has the responsibility to review and approve government budgets, will recognize the need to provide the levels of financial support that the SFC will need in the near term and beyond.

For a number of years, Asian markets’ demand for rhino horn – whether as medicine or luxury good – has contributed to transnational illegal wildlife trade that has been pushing rhino populations closer to extinction.  One development that apparently had some effect in temporarily reducing rhino poaching in South Africa was the COVID-19 pandemic.  The number of rhinos poached in South Africa declined by one-third from 594 in 2019 to 394 in 2020.  But as the South African government eased COVID lockdown restrictions in late 2020, rhino poaching reportedly began to rise sharply, especially in late 2021.

A recent report by the South African Ministry of Forestry, Fisheries and the Environment confirmed this trend.  According to the Ministry, 451 rhinos were poached in the country in 2021.  This represents a 14 percent increase over the 2020 total of rhinos poached.  The Ministry noted that the 451 rhinos poached represented a 24 percent decrease compared to 2019, and that the 209 rhinos poached in South African national parks represented a 15 percent decline from 2020.  At the same time, the Ministry recognized that there had been an increase in poaching on private properties in South Africa.

The Ministry also reported that in 2021 there had been 189 arrests in connection with poaching activities and 61 convictions of accused rhino poachers and traffickers.  In a number of successful prosecutions, sentences ranged from 16 years’ to 85 years’ imprisonment.

Nonetheless, the unabated demand for rhino horn, coupled with the lingering effect of COVID in discouraging tourism, is likely to generate still further increases in rhino poaching in South Africa.  South African authorities are vitally dependent on tourism dollars to fund their anti-poaching efforts.  If tourism continues to lag behind the surge in poaching, and poachers continue to stalk rhinos in private properties, South Africa may again find itself facing a crisis in trying to protect its dwindling rhino populations.