It is Time for Watchful Waiting by All, and Not for Protests

By William Stork

Despite much in the media on 26 May calling for world leaders to confront China on what has happened with respect to Hong Kong this – IMHO – was perhaps ill-advised, and I speak as a long-time resident of the HKSAR.

First off, the news then was not quite correct. Last Friday’s proposed legislation was only a ‘suggestion’ raised at the China People’s Congress. No vote had yet been taken and the Representative from Hong Kong encouraged those with views to visit the website where such responses are recorded (but not published).

That was then, and this is now (30 May), and much has happened since!

It’s now a done deal. Not only has the legislation been passed but it has been amplified. It now includes ‘activities’ as possibly needing terrorist suppression. Also of note that Beijing will set up its own ‘agencies’ in Hong Kong to assist in this effort. Implementation is not yet known.

Do activities include ‘rallies’? Annually on June 4 there has been a peaceful vigil to remember the protests at Tiananmen Square in 1989. Would this expression of free speech be curtailed? And as for Beijing ‘agencies’ in Hong Kong, the commander of the Peoples’ Liberation Army here has already loudly expressed willingness to support the government in its efforts to suppress the political protesters now deemed ‘terrorists’ by the government (which well matches Beijing’s comments about the activists).

Secondly, part of the proposal directly mentions outside interference (think of ‘meddling in China’s affairs’), and foreign expressions of outraged concern and related foreign governmental actions that just feed into this antagonism. I felt that this animosity was unnecessary at a time when cool, reasoned efforts should come into play. But this was not politically satisfactory to some of the foreign parties involved. The UK, the US, Canada, and others have weighed in to persuade/pressure Beijing to be less restrictive. In response China has aggressively roared back, essentially saying ‘this is not your business, but ours alone.’ Most alarming then was the decision by the head of the US State Department Mike Pompous to send word to Congress that he can no longer certify Hong Kong’s autonomy.

Third, with that decertification came an implied threat that the US could end its position that Hong Kong should continue to enjoy free trade status. Here that sent the American Chamber of Congress – Hong Kong (AmCham) into a tail-spin. AmCham is one of the largest chambers of commerce outside the USA. Tara Joseph, who I knew when president of the Foreign Correspondents’ Club here, is now president of AmCham and had this to say about the Chinese law marking “the end of an era” for the region.¹

“Hong Kong, in many ways, has become the new Berlin: the new meeting point of a big argument of big disagreement between two major powers, China and the United States,” she said. “We can expect a lot of friction here as a result.”

That friction has now come with Trump’s announcement of wanting to end Hong Kong’s unique trade status. While it remains unclear as to whether this aspect of his China-bashing is political rhetoric — to build back his political base at a time when weakened by Covid and the economic downturn — is yet to be seen. Now he dictates to Congress to do this, to also end US membership in WHO, and further to conduct investigations of social media (now that Twitter is marking his tweets). From my distant perch, so much now seems to be done by executive order, rather than by Congress. (I guess that is to be expected since he has lost control of the House and, with regard to Hong Kong, Nancy Pelosi indicated it ‘was time to put on the brakes’ on threatening rhetoric.)²

In Hong Kong there is much concern what with China’s new approval of ‘wolf warrior’ diplomacy, that China will respond with further escalation of its effort to exercise greater control of Hong Kong. There is no doubt now of its willingness to end Hong Kong protests. On last Wednesday at the protest³ the police arrested almost 400, and of these over 100 were children!

This further evidence that China has much to do to ‘reform’ the thoughts of HongKongers is worrisome to Beijing.

All this is a lot for me to consider at this time when Hong Kong is trying to find its way back to the ‘old normal’. For over almost two months now Hong Kong has reported no local Covid infections. Physical distancing restrictions are being relaxed, delighting residents in the current warm weather who flock to now-open beaches and pools (where physical distancing regulations are still in force). Yet that ‘old normal’ also saw evidence of the political divisions, still widespread, return to Hong Kong as the above photo shows. That event, which included fired tear gas pellets and water cannon, was rowdy with unnecessary violence on both sides, and with almost 400 arrested. I have just gotten an ‘alert’ from the US Consulate General Hong Kong Office about demonstrations planned for this weekend at the HKSAR governmental offices. That part of the ‘old normal’ does seem to have returned!

But protests, here or abroad, are not going to solve Hong Kong’s basic problems. Nor, apparently, will the lack of effort to so do by Hong Kong’s Chief Executive or Beijing. Yet to be seen is what the severe economic downturn will bring, and whether the influential Hong Kong tycoons will begin to let their views be expressed and to influence opinions.

Worth noting is that Xi is under pressure from leading members within the CCP Politburo, worried that the inability of Hong Kong to subdue protests will spread to the discontent present in the Chinese populace in some critical areas. Apparently, the crackdown on Hong Kong, in part to support his position at home, was seen as a necessary risk as Hong Kong approaches those critical elections in September.

But for the time being, while I would wish for a calm period of watchful waiting that could have been most advantageous, too much momentum is now in place. Friends are already talking about relocation, as are some businesses, and I even hear about that possibility here at home.

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1. It is important to note that 1,300 US businesses are invested in Hong Kong, employing over 100,000. Additionally, there are a large number of firms from the UK invested in Hong Kong. In 2019 the US exported @118.9 billion worth of good to China, and much of that was done through using Hong Kong’s status as free-trade port. Separately, in 2018, the goods surplus of US exports to Hong Kong was $31 billion and the services surplus was $2.3 billion. Hong Kong also serves as a free trade port for the US in trade with the ASEAN nations. In the first nine months of 2019, Hong Kong’s total exports to ASEAN increased by 2.6% YOY to US$29.6 billion.

Additionally, Hong Kong in 2019 was the global leader in new IPOs, at a total of about $40 billion. This will be lost as Hong Kong’s position as an international financial hub is ended.

2. I liked the comment, quoted by Yale alum Fareed Zakaria, from the South China Morning Post, of Scott Kennedy of the Center for Strategic and International Studies, one who makes a similar case: “The international community may not be able to prevent Hong Kong from ultimately ceding autonomy to the mainland,” he argues, but “it is well worth trying to affect the pace, sequence and manner in which change occurs.”

The US should wait “until after the national security law is actually adopted and the US and others can observe how it is being implemented,” Kennedy writes, noting that if the US follows through on its threats too soon, they’ll lose their power. “Given [Chinese President] Xi [Jinping]’s playbook, the chances of this story becoming a tragedy are high. However, by being clear about their bottom line but flexible in applying specific measures, the international community can create an atmosphere that leads Beijing to take a more cautious and constructive approach.”

3. Yet there is still the jockeying between the pro-Beijing/establishment parties and the pan-democrat parties as we proceed towards those critical September Legislative Council (LegCo) elections mentioned in my earlier article. Continued divisions will escalate. One of the pieces of legislation that had its second reading Wednesday in LegCo (at Beijing’s suggestion) is a law banning any mockery or booing or other forms of disrespect of the Chinese (and thus Hong Kong’s) national anthem. (There was much such disrespect at the soccer-football matches here last year.) This, along with the new law in Beijing, was the reason for the huge protest here last Wednesday.

 

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