HONG KONG: Hong Kong has played a central role in the two great stories of our era — the rise of China and the globalisation of the world economy.
More than 30 years ago, China’s emergence as the workshop of the world began just across the border from Hong Kong, powered by the territory’s money, expertise and international connections.
Today, Hong Kong continues to serve as a crucial gateway between China and the west.
But the world is now entering a post-globalisation era characterised by populist unrest and rising tensions between the US and China. And once again Hong Kong is central to the story.
A WAVE OF DEMONSTRATIONS
For almost two months, the territory of 7.4 million people has been hit by a wave of demonstrations. This began as a protest against a proposal to allow suspects to be extradited to mainland China.
But it has now spiralled into broader complaints against police violence and demands for fully democratic elections.
Those protests are still going and becoming more violent and unruly. On Sunday night, I had to wear a gas mask in the area around the Financial Times office in central Hong Kong because the streets were so full of tear gas.
En route, I passed street fires, makeshift barricades, charging riot police and piles of rubble assembled by protesters to use as missiles.
Watching another chaotic and occasionally violent protest the previous day, I was struck that a number of demonstrators were carrying the US flag — something that China will certainly seize upon to support its contention that America’s “black hand” is manipulating the protests.
SEEKING HELP FROM THE US
Speaking to a group of protesters gathered under the Stars and Stripes, I found them eager to see the US Congress press ahead with a proposed Hong Kong Human Rights and Democracy Act, which threatens to take away Hong Kong’s trade privileges with the US, affecting tariffs and technology transfer, that are not enjoyed by mainland China.
This would happen if the territory’s autonomy is threatened by Beijing.
The demonstrators, who were office workers and students, issued a plea to US President Donald Trump, who is admired by many in the Hong Kong democracy movement because of his willingness to impose sanctions on China.
Mr Trump’s capriciousness should make the Hong Kong demonstrators wary. But the anti-China sentiment in Washington is now bipartisan and influential figures in Congress, including Nancy Pelosi, the Democratic speaker of the House of Representatives, and Republican Senator Marco Rubio, have taken up the cause of Hong Kong.
Even without US sanctions, heavy-handed Chinese intervention — for example, the deployment of the People’s Liberation Army on the streets of Hong Kong — would provoke a spontaneous loss of confidence, prompting international businesses to pull out of the territory.
Some argue that Beijing no longer needs Hong Kong to act as a gateway to the west. But although China is now unrecognisably richer than it was 30 years ago, there are certain crucial functions that the territory still performs for the mainland.
Chinese companies that want to float their shares on the international markets need Hong Kong, which is the world’s fifth largest stock exchange. The territory also acts as a crucial centre for legal services and insurance.
Many wealthy Chinese families have investments and bank accounts in Hong Kong, and will be reluctant to jeopardise their nest-eggs.
Knowing all that, Hong Kong demonstrators hope that the threat of US sanctions will force China to make concessions to their demands. Some even seem eager to see America withdraw Hong Kong’s special privileges, despite the economic damage that would do.
They quote a proverb — “Better to die now, in order to be reborn later” — to justify their call for international pressure.
That kind of radical sentiment should alarm Beijing — as should a chant heard on the streets, “Defend Hong Kong, time of revolution”. The slogan was invented by Edward Leung, an activist linked to the Hong Kong independence movement, who is serving a jail sentence.
WAITING OUT THE DEMONSTRATIONS
The need to maintain political control in Hong Kong is likely to be paramount for Beijing. So if the Chinese government thought it would work, it would not hesitate to deploy troops.
But the dangers of sending in the PLA are understood in Beijing. Even the Global Times recently ran an opinion piece counselling against PLA intervention on the grounds that it would run into local resistance, making it hard to consolidate control.
For the moment, then, it seems most likely that China will try to wait out the demonstrations, hoping that they will lose momentum, as summer turns into autumn and students return to school and university.
But the protest movement seems to be escalating, rather than fading away.
In the boom years of globalisation, Hong Kong was always said to be the epitome of a commercial city whose citizens cared little for politics, as long as they could buy, sell and shop.
READ: Behind Hong Kong’s extradition bill protests – a looming divide, growing pessimism about the future, a commentary
But, across the world, the period when economic concerns always seemed to override politics is over. Once again, Hong Kong is at the forefront of a new era.