In August 2021, the Financial Secretary Paul Chan stated that Hong Kong should have a strategic plan for formulating new development directions (Xinhua, 2021). Developing a data governance framework for cross-border data flows that balances competing interests, enables efficient operations, does not stifle business while keeping anti-competitive behaviour in check and is flexible enough to handle future innovations and challenges would be an excellent place to start. But to do so requires awareness of the degree to which systems are interconnected and the implications (and fragilities) of the resulting complex interdependencies and conflicts.

Spotting the predicted effects of data interconnections can sometimes be done with relative ease – for instance, concluding that combining personal data and mining it for behavioural insights and other information could clash with privacy protections is not hard (European Commission, 2021c). On other occasions, the link or the breadth of the link may not be so obvious. This will be the case with Europe's proposed but yet to be ratified Artificial Intelligence Act (AIA), which will place any product that contains AI into prohibited, high-risk and limited categories, prescribing obligations for each category. The AIA will also ban the use of AI for subliminal psychological manipulation as well as prohibit public authorities from using real-time biometric surveillance and building AI-powered social scoring systems. The interconnection, while less obvious, is no less significant with one report suggesting that the AIA could cost the EU €31 billion over the next five years in added compliance and other expenses, deter investment into European AI start-ups, slow the digitization of the economy and encourage a brain drain of European entrepreneurs,data scientists and AI developers to locations with fewer bureaucratic hurdles (Mueller, 202b).

But there was another interconnection the review did not include, that is, how the EU's underlying policy of cooperation with ‘like-minded countries’ who espouse European rules and values (particularly concerning the protection of privacy and personal data) could disadvantage European firms (European Commission, 2020d). These could occur in numerous ways. For instance, there is a real risk that the new restrictions will stif le data f lows from countries the EU does not deem to be satisfactorily ‘like-minded’.