China’s Message to Hong Kong

On February 4th  Hong Kong authorities decreed that children as young as six must learn the attributes of the draconian security law imposed on the city last June.  Children are instructed that the measure assures “continued development and long-term prosperity” for Hong Kong.  There’s even a video to assist teachers. 

The required instruction on security is only the latest curriculum revision bringing education in Hong Kong closer to mainland practices. Content that focuses on personal freedoms and democratic standards is eliminated. Teachers, of course, have not been consulted. 

Curriculum revision is further evidence that hardliners have won and the city’s pro-democracy movement—for now—is dead. 

Back in May 2019 when tens of thousands of youthful protesters filled the streets,  Hong Kong’s most respected politician, 82-year-old Martin Lee, declared “we want to change China before China changes us.”  The mild-mannered elder statesman continued, “Hong Kong is the key to China. If we prevail there is hope for the rule of law in China.”

Two years later it’s hard to be optimistic. In January 53 pro-democracy politicians were arrested while protest leaders had already been silenced.  Activists Joshua Wong and Agnes Chao, both 24, are behind bars serving 10 and 12-month jail terms.  Protest leader Nathan Law, 27, fled to England and even the venerable Martin Lee was arrested and briefly held. 

Step by step China is tightening its grip on Hong Kong crushing opposition. Its biggest club is the security law that gives police almost unlimited powers, its provisions so broad that almost anything can be labeled as sedition. 

Ironically to some, the calm and stability of the past year is popular with the city’s powerful business leaders, several of whom warned students they were overplaying their hand, inviting the clampdown that has now occurred.   

Increasingly young Hong Kongers are fleeing or contemplating doing so. This does not displease Beijing. There are estimates that as many as 300,000 may take up Britain’s offer of eventual citizenship for those emigrating to the UK.  For a territory of seven million the numbers portend a significant brain drain.

Hong Kong’s prosperity has always been linked to trade with the mainland. That the city became a financial center rivalling New York and London is a function of stable government, property rights, rule of law, and ease of doing business. Finance accounts for $10 trillion of annual business in Hong Kong and employs 258,000 people. The city is the largest off shore venue for trading renminbi, the Chinese currency. Half the capital flowing into China passes through Hong Kong, which has its own currency linked to the US dollar. The Hong Kong stock exchange leads the world in initial public offerings.

Since the 1997 handover Hong Kong has been steadily incorporated into the greater bay area, Beijing’s project of making 11 megacities with 70 million inhabitants a global trade and innovation hub. Hong Kong is to be the region’s finance center. The carrot offered to Hong Kong banks, brokerages and insurers is access to the bay area’s exploding middle class, a huge and underserved market.

Money manager Louis Vincent Gave is optimistic about Hong Kong. A long-time resident of the city, Gave told Barron’s in December that President Xi Jinping has no choice but to keep Hong Kong as a financial center:

“If you are Xi and you hear your companies won’t have access to the US market, Hong Kong sounds like a great way to internationalize the renminbi and do a digital renminbi. Most Westerners saw the intervention (suppressing democracy) as the death of Hong Kong but China (has) guaranteed Hong Kong would be China’s capital market for the foreseeable future.”

For now the 1,300 American companies and 85,000 US citizens in Hong Kong are staying put. American Chamber of Commerce president Tara Joseph says, “there’s no rush for the exit.” But, she adds, “the rule of law is paramount.”  That is the big question.  If the assault on western institutions persists and the judiciary and media come into the government’s cross hairs there is bound to be an exodus.

Beijing has violated the basic law that codifies the one country, two systems frame work until 2047. The retaliatory measures taken by the US and UK have not swayed China’s hardliners.  

Martin Lee’s hopes of Hong Kong changing China have been dashed. Instead it is China that is changing Hong Kong. #   

Washington-based journalist Barry D. Wood contributes to RTHK radio in Hong Kong but views expressed here are his own.

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