"urgent" is obviously false. That would have entailed action weeks ago. I'd say China is drafting a maximally expedient plan to capitalize on the situation in their own sweet time, since the rest of the democratic world is committed to playing corporatist small ball in Hong Kong, but I'm not the editor in charge of creating clickbait titles.
I think they meant emergency plan. The article could be translated from Chinese. "紧急" could be translated as "urgent," but "紧急计划," with plan attached, is better interpreted as emergency plan.
This is Bloomberg, the same news site that made outrageous and still-unsubstantiated claims about hardware backdoors in Supermicro's motherboards. Sadly this kind of media drives profits and with no repercussions has become par for the course with companies like Bloomberg.
They're financial and foreign reporting has been sublime for decades. I agree that their new venture into IT and Digital has not been great, but don't dismiss the entire company solely on that.
Take it with a grain of salt.
SCMP is owned by Jack Ma. Jack Ma isn't going to die on this hill even if he agrees with HK. He's going to do what the PRC asks of him.
SCMP have maintained reasonable independence from the mainland so far. But if ever there was a time for the PRC to pull strings and use SCMP for disinformation, now would be it.
could we address the implication here more critically? what logical reason is there for violence and bloodshed? it feels like us westerners are so prone to caricature the Chinese government as some kind of cartoonish villain. to me the CCP is coldly rational, and I don't see the reasoning here for them escalating the conflict.
A cold, rational CCP wouldn't have gotten itself into this mess. Hong Kong was popularly pro-China before the extradition bill. Re-integration in a few decades would have gone smoothly. But someone got impatient and jumped the gun.
> Re-integration in a few decades would have gone smoothly.
You over-simplify the integration of a region which has its own strong identity, liberal rules and culture. One can't tell which measures will lead to strong resentment and which will get accepted - among the many that will eventually be needed.
It's probably gonna get worse unless China itself opens up. But in any case, it seems fairly evident that Hong Kong will have to fight this fight alone and the rest of the world will merely watch.
> You over-simplify the integration of a region which has its own strong identity, liberal rules and culture.
> It's probably gonna get worse unless China itself opens up.
Agreed with both points.
> One can't tell which measures will lead to strong resentment and which will get accepted - among the many that will eventually be needed.
In fact the public opinion was clearly against the extradition bill, but the government has a record of passing bills against strong public opposition (e.g. the High Speed Rail and its Juxtaposed controls).
> But in any case, it seems fairly evident that Hong Kong will have to fight this fight alone and the rest of the world will merely watch.
Not quite. In this fight, Hong Kong has got support from Britain [1], Europe [2], the United States [3], among others. The most powerful one is the “Hong Kong Human Rights and Democracy Act of 2019” [3], a bipartisan bill introduced by US Representative Jim McGovern and Senator Marco Rubio. The bill would put real pressure on China (and pro-Beijing officials) to choose between worse financial access and democracy for Hong Kong.
> Hong Kong was popularly pro-China before the extradition bill.
Depends. For economic co-operation or dependency, probably yes. But Hong Kong people has very little faith in the Chinese legal system, most of us know it's a facade, from the grass-root to the super-rich.
That's why, by pushing for the extradition law amendment, which, if passed, would allow the Chinese government to extradite "criminals" from HK based on their laws, the HK government has kicked the hornet's nest.
what logical reason is there for violence and bloodshed?
Democracies tend to be more stable than dictatorships because there's a relief valve for massive public dissent - ie elections. Dictatorships often meet their end suddenly, because a revolution is the only mechanism they have to change things. It's therefore better to quell a rebellion violently and cover it up later, than risk the spread of discontentment.
The reason it's not being put down bloodily (as is typically the case) is because it's an issue confined to Hong Kong with a low chance of spreading. If it dud spread over the border, things would be different.
I understand the point you are trying to get at, and it definitely applies to other countries/dictatorships.
Present-day China, however, actually has a very efficient mechanism (relief valve) for dealing with massive public dissent, which is their largely hierarchical governance model (township -> county -> prefecture -> province -> central government).
When citizens have grievances, it's often against policies perceived to be imposed by local government officials. If the unrest becomes serious enough, many times these grievances are actually brought to the attention of the central government who then have an opportunity to step in to save the day and fire/replace all of the local officials involved (to the satisfaction of the mob). A surprising number of mass protests have been quelled peacefully in China in this way, over the years.
The problem is when the local official is clearly implementing policy from the central government, such as the case now with Lam implementing an extradition treaty with the PRC. If you replace Lam and try again, the same protests would appear again because Hong Kong’s issue is not with the Legislative Council per se, it’s about this treaty from the CCP.
And, the CCP has a very hard time convincing the people of Hong Kong they won’t be prosecuted for dissenting speech after the Causeway book sellers were kidnapped.
Their release valve has hit a bit of a snag here. Democracy is tried and true though, maybe they could give it a try in Hong Kong?
Fair point. My comment was only in response to GP's sentence about quelling protests on the Mainland. I doubt any such tactic would be effective in a highly educated and already distrustful population like that of HK.
Yeah, to that I agree. I have a colleague from China and in her experience, moving from her smaller city (population 300 000) to Shanghai was a big eye opener for her. She was exposed to more educated people and more sources of information outside CCP control.
The tactics you describe to quell protests would definitely work in her hometown and 90% of all other population centers in China. The other 10% are doing great and don’t feel like protesting the smaller issues.
Military response would draw a lot of negative responses from the international community, and would be a clear rebuke of the "one country, two systems" that Hong Kong is supposed to be operating under. This could put HK's special economic status in jeopardy, which would be both damaging to Beijing as well as the HK business elite. It's better for the CCP if they can have the city suppress the protests using their own police force. After all, Western countries use the police to control protests all the time.
I agree that some stereotyping might be happening, though there are several cases of aggression that fuel it.
1. Tiananmen Square was a brutal massacre that gives a visceral reaction
2. The hunting of the Falun Gong practitioners seems insane. I had a friend in the US whose family members were disappearing and were being harassed in the US. They were getting phone calls with recordings of their wiretaps.
3. China is holding ethnocidal camps for the Uyghurs
4. China threatens war quite often, whether it be about disputed islands in the South China Sea or even whether China should get to artificially set currency exchange rates. (I understand that the US is practically speaking much more belligerent, though many US citizens may be blind to their own behaviors)
The “one China” philosophy is a pretty core government tenet. If Hong Kong exercises its independence it could exacerbate other territories/provinces that want independence like Tibet and Taiwan (whose residents seem to pretty explicitly consider themselves a different country)
One the other hand, military action could plausibly cause long-lasting international upset.
Taiwan is de facto independent. It's just that China is sabotaging recognition of its independence through the one China policy. But that could change if a country like the US would openly challenge this.
The One China policy states that there is one China, either under the PRC or the ROC.
The PRC claims that Taiwan is a Special Administrative Region of the PRC while the ROC claims de jure sovereignty over all of China. There are significant political parties within Taiwan itself (the Pan-Blue Coalition parties) that support the One China policy.
If there isn't even internal consensus regarding independence in Taiwan, I think it's fair to say that the issue is a little more complicated than "China is sabotaging recognition of Taiwan's independence".
Indeed, and what's happening in Hong Kong is already affecting Taiwan, giving additional support to the pro-independent camp.
BTW, the ruling party of ROC was pretty authoritarian back then too. IMO, the contrasting political development of the ROC and PRC in the last few decades is worthy of further evaluation and consideration.
Taiwan is controlled by the ROC (Republic of China) which has existed since the end of the Xinhai revolution in 1912. The PRC (People's Republic of China) has no claim on Taiwan, has never controlled it, and has no legitimate casus belli for acquiring it.
Maybe my sample size is too small, but when I was in Shanghai they very clearly felt Taiwan was a (rebellious) part of China. To claim that PRC has no claim on Taiwan ignores the fact that even the US recognizes Taiwan as part of China (though to keep status quo we still sell arms to Taiwan).
Edit: sorry for the country typo; Was thinking about a trip to visit my friend in Shanghai who lived there until moving to Singapore recently.
> To claim that PRC has no claim on Taiwan ignores the fact that even the US recognizes Taiwan as part of China
The US has never officially recognized that the island Taiwan as part of the PRC, only as part of "China", which is ambiguous because there are two nations calling themselves China (PRC and ROC).
This is false. The US has "acknowledged" the "One China" position of both sides of the Strait since the 1970s, but it has never supported the notion that Taiwan (and Kinmen, Taiping, etc.) is PRC territory or that the mainland is ROC territory.
The feelings of Singaporean residents about the matter are not relevant to the discussion at all.
> Maybe my sample size is too small, but when I was in Singapore they very clearly felt Taiwan was a (rebellious) part of China. To claim that PRC has no claim on Taiwan ignores the fact that even the US recognizes Taiwan as part of China (though to keep status quo we still sell arms to Taiwan)
The US has agreed not to have official relations with the ROC, but the US has _never_ recognized the PRC's claims of Taiwan and the rest of the land controlled by the ROC.
There's a key difference in that the camps are actually about reeducation/brainwashing (or at least forced conversion away from Islam), as opposed to systematic slaughter of said minorities.
If you read the reports from the camps you see that there is a very high death rate. For example this woman (https://www.apnews.com/61cdf7f5dfc34575aa643523b3c6b3fe) claims that 9 of the 60 women in her cell died over the course of three months. Extrapolate that over 2000000 people being held and it's clear that this is genocide.
> as opposed to systematic slaughter of said minorities.
By "early Nazis"? No.
And the purpose isn't restricted to the people in them, it goes way beyond murder.
> While the separation of inmates into categories was merely a tactical-organisatory measure for the the purpose of administration of the camps, the arbitrariness of committal demonstrates the essential principle of the institution as such. The existance of a political opposition is just a pretext for the concentration camp system, and its purpose is not achieved when the population more or less voluntarily conforms as consequence of the most monstrous deterrence, that is, to give up its political rights. The arbitrariness has the purpose to deprive those under the totalitarian regime of all their rights as citizens, which finally become as outlawed [vogelfrei] in their own country as otherwise only the stateless and homeless. The deprivation of humans of their rights, the killing of the juridical person in them is just a precondition of their being totally controlled, for which even voluntary agreement is a hindrance.
-- Hannah Arendt
That was true in China even before those camps, and that people with a cartoon understanding of history, concentration camps, Nazism, just about anything related to this, roll their eyes at "making" someone a "villain" is as predictable as it's their own fault.
What logical reason is there to imprison 1 million Uyghurs in detention camps and to restricting travel and to separate husbands from wives and to separate young children from their parents. Where is the logic in doing what can only further alienate the Uyghur population? Where is the value in it?
You can read the government's formal justification at http://www.chinadaily.com.cn/a/201903/19/WS5c9033f0a3106c65c... . Their argument is basically that foreign influence is trying to make Uyghurs more extreme in their religious beliefs, causing them to commit acts of terrorism. They argue that if they can completely prevent this foreign influence, and brainwash everybody who's inclined to extreme beliefs into avoiding those beliefs, they'll eliminate terrorism and keep Xinjiang safe for the majority who are not religious or not extremists. Essentially their argument is that if you can stamp out non-mild Islam, you stamp out Islamic extremism, which is a logically consistent argument (although of course whether their approach could actually stamp out extreme Islam, as opposed to just breeding more resistance, is a matter of debate). In this context their justification for preventing travel and separating families is preventing the spread of extremism and preventing communication between extremist groups.
Another way to look at it. Imagine you're an amoral government bureaucrat ruling Xinjiang, and you're getting pressure from above about the terrorist attacks there (especially when Xinjiang residents are committing terrorist attacks in other provinces). Your KPI is to reduce the number of terrorist attacks to zero, and you have near unlimited funding. What's the simplest approach? Lock up anybody who has even the tiniest possibility of committing a terrorist attack, and institute the maximum amount of surveillance and monitoring that's technologically possible to identify any planned attacks. Also prevent your residents from going to other provinces, so even if they do manage to conduct a terrorist attack, it won't piss off anybody important (other province governors). That's the logic behind it.
I think you've misunderstood the nature of rhetorical questions. I'm not interested in the Chinese government's pretexts or rationalizations. The problem is the violation of the basic human rights of people who have done nothing to warrant it.
You may call it a rhetorical question, someone else might see it as bad faith to ask about the government's rationale if you have no intention of actually listening to their reasons. You're not going to have any success convincing the average Chinese citizen that locking up Uyghurs is wrong if you're not going to engage with their concerns (the belief that if not for the government's actions they might be at risk of terror attacks).
How is it good faith then? Imagine the Chinese government is a person, you walk up to them and ask "what is your reason for doing this?". They start to explain "my reason is..", you stick your hands in your ears and reply "don't want to hear you, don't care, your reason is wrong, you are wrong!". That's not a productive way to engage with a point of view; it's certainly got zero chance of changing anybody's mind, all you achieve is pats on the back from people who already agree with you and the feeling of satisfaction from knowing you're morally right.
The Chinese government is not a person. There is no value in thinking of it as such.
> you walk up to them and ask "what is your reason for doing this?". They start to explain "my reason is.."
Their reasons don't matter. Only their actions matter. Only the outcomes matter. What they are doing in Xinjiang is plainly wrong. There is nothing to debate here.
Their actions are dishonest and unjustified. Dressing up the immorality of what's being done in Xinjiang as a point of contention or debate is also dishonest.
>The Chinese government is not a person. There is no value in thinking of it as such.
The Chinese government is made up of people, and China is made up of people that generally support the government.
>Their reasons don't matter. Only their actions matter. Only the outcomes matter. What they are doing in Xinjiang is plainly wrong.
If only outcomes matter, then shouting "you're wrong!" at them isn't going to change any outcomes. You're not going to change the mind of any Chinese people who support the government by telling them "you're morally wrong!". It's long past the stage where America had enough of a military advantage to intervene militarily, so if you want to bring about change the only way to do so is engaging in dialogue with the people who support those policies. It's not possible to engage in dialogue with them if you don't understand their motivations and reasoning.
Don't be dishonest. I find talk of "good faith" so laughable when all that's offered are dishonest attempts to defend the Chinese government's deliberate effort of cultural extermination.
You should not ask the questions you do not want an answer to, regardless how rhetorical they seem. This is HN, not Twitter.
Thought stopping cliches will get pushed back.
Violation of human rights (if these are even recognised by PRC under your definition; they're not) are committed on both sides. Trying to weigh them is silly and does not make them any better.
Measuring others by your yardstick is a kind of imperialism.
To the people who downvoted this, note that presenting the Chinese government's argument doesn't mean supporting it. That said, if you're completely unwilling to even hear your other side's argument, you'll never be able to engage in productive debate or convince them of anything. You're also unlikely to have an accurate view of any situation if you're only listening to one side of the story. The Chinese government can get away with concentration camps in Xinjiang because many citizens are fine with it, and you're never going to change those peoples' minds by just shouting "you're morally wrong" at them.
I like the idea that making the argument "the major media are corruptly harking back to the Yellow Peril", phrased in those terms, is "highly anti-semitic", while making the argument "the Jews control all the major media" is also "highly anti-semitic".
If the first claim is anti-semitic, on what grounds can you dispute the second?
You didn't even get the word right. It's "anti-semitic". And also pls explain and elaborate how is a piece of news about Hong Kong related to the Jews?
Protesters are already facing threats of physical violence, so saying that there won't be overt military action isn't likely to change many minds. Dozens have been injured in altercations with the Hong Kong police department since protests started last month. There have been several accusations of police brutality, coming from both protesters and journalists. There are also accusations that the police are already using the PLA or other forces from the mainland to bolster their ranks, but it's hard for me to tell how likely that is too be true. The primary pieces of evidence that I hear are officers covering or wearing incorrect identification numbers, and officers speaking little/no Cantonese & speaking Mandarin instead.
I think they are smart enough to realize that military intervention would blow the lid of this thing domestically and create a huge outrage internationally. The Tienanmen protests was the closest they got to revolution since Mao created the modern China state. The only reason military intervention worked at the time was because they had a local population with an active memory of Mao's oppression and total control of media. Lots of communist regimes collapsed at the time and the Chinese got pretty close as well. They don't want a repeat of that and they have plenty of places across China where they've been working hard on keeping a lid on local unrest.
Hong Kong was in British hands throughout last century and has an active memory of how things used to be before the handover. Also, they remember Tienanmen. There are numerous ties to the outside world in Hong Kong as well as to the rest of China because of family ties, trade, local freedom of press, etc. A military intervention would be impossible to hide domestically. Spin off protests in e.g. Bejing and other Chinese cities are at this point unlikely but not unimaginable if they don't contain this. Even if this doesn't happen, the mere possibility of this might be enough to weaken the current leadership and the fear of that is very much informing current actions. Tienanmen remains a taboo topic in China out of fear of something like this happening again. The last thing they want is this spreading.
They don't fear revolution as much as political leadership change. Xi Ling Ping's grip on leadership is being weakened by this. He and the people he put in positions of power need this to go away. The sooner the better.
So, what I expect is the Chinese finding a creative way to de-escalate this such that Hong Kong goes back to business as usual. It will probably involve a way of sacrificing Carrie Lam, who at this point is the very definition of a lame duck and the focal point of the protests. Speculation of her stepping down has been rampant for weeks. Probably they are slowly coming to the conclusion that keeping her around is not helping the situation. Removing her would allow the protests to calm down and allow business as usual to resume. I imagine business as usual sounds pretty good in Bejing at this point. I'm guessing that as this drags on, they are warming to getting rid of her sooner rather than later. I'd be very surprised if she's still around a month from now.
Let me gently suggest you read up on Hong Kong a little bit more. No need to go back 40 yrs. Just last 5. The Umbrella movement in 2014 had greater participation, attracted much more international media attention, subsequently wreaked much greater havoc in the territory, and lasted much longer than the current protest. Yet, the Chief Executive at the time, Mr. C. Y. Leung, did not resign. Go figure.
Mr. Leung was indeed allowed to serve his term but not allowed to re-run (which was his ambition). The Umbrella movement ended his political career and he served out his term as a lame duck. No matter how you spin this, he basically left the political scene with his tail between his legs. Carrie Lam is similarly politically dead. Unlike Leung, I expect they won't keep her around as the protests are increasingly about her specifically. Neither Lam nor Leung had any say in this matter; it's all about what Bejing allows to happen. Clearly their handling of the Umbrella movement just set them up for what's happening now, which in terms of scale and popular support is a problem for the current leadership because their ability to keep the lid on this domestically is not infinite and they need the two party system to be a success to keep a grip on Taiwan, which is another thing they seem to not have under control lately.
So, I'm predicting they will seek to remove the problem a bit sooner and ms. Lam seems like she's expendable, politically dead anyway, and a big part of their problem.
There's no reason to keep her around either. Every time there's a new protest, the first demands are: 1. Full withdrawal of the extradition bill, 2. Carrie Lam resigns. The bill is politically unviable for the foreseeable future, and Lam is its figurehead. If they want to take steam out of the protests, they need to address these sticking points.
If they have a new CE come in, fully drop the bill, and actually set up an independent investigation into police brutality, it would take a lot of wind out of the sails of these protests before people dig their heels in on other issues (abolish the functional constituencies, establish universal suffrage, etc.)
I agree with the suggestion that the Chief Executive will not resign right away, as does some rumor [1].
> The Umbrella movement in 2014 had greater participation, attracted much more international media attention, subsequently wreaked much greater havoc in the territory, and lasted much longer than the current protest.
However, I disagree that the Umbrella movement had greater participation, nor attracted much more international media attention. For one, due to timing and other factors (such as the extradition bill concerns foreign diaspora in Hong Kong, and the ongoing trade tariffs and “new cold war”), this protest coincides with more media attention and actual international actions, in particular the “Hong Kong Human Rights and Democracy Act of 2019” [2], which could put real pressure to get a response from China.
> Hong Kong was in British hands throughout last century and has an active memory of how things used to be before the handover.
This is the only bone I have to pick.
Hong Kong has a short memory of how things used to be. People around 30-40s won't remember a thing when the colonial overlords rule with an iron fist.
There's a reason why generally, there's a rift of opinion between the young people, and the older generation.
Because many of the older generations had even worse memories from PRC and the civil wars. Yes, the British ruled with an iron fist as well, for a large part. But livelihood was generally improving for most (which may or may not [entirely] be due to something that the British did) during the run-up to the handover.
There is no need for Xi or China's establishment to do anything here. They will simply wait it out. Hong Kong is and always will be wholly dependent on its relationship with China. There is no end game where democracy and freedom wins and they secede from China and live happily ever after.
What will most likely happen: the everyday people (shopkeepers, professionals, etc) who need to earn a living will tire of the endless disruptions currently paralyzing their streets and businesses. They will realize that the more radical elements of the demonstrations are undermining the very things that they are fighting for that make Hong Kong an attractive place for investment and international business in the first place: societal stability and the rule of law.
This will most likely occur some time around mid-August, when the school season begins.
> Hong Kong is and always will be wholly dependent on its relationship with China.
They're dependent on their relationship with somebody. Not necessarily China. It used to be Britain. It could be someone else. (Maybe the US, similar to the relationship the US has with Japan, South Korea, and sorta-Taiwan.)
North Korea is valuable to Russia and China because it keeps (US-allied) South Korea away from having a land bridge into either of those countries.
In other words, entire countries can be propped up for decades not on their worth as an ally or vassal, but rather on their worth as a hindrance to your enemies.
I would expect, if HK found a new patron, it'd be for that reason.
New patron? They're legally part of China, and honestly have no secession rights, no defensive position, and no allies willing to fight the PRC.
Someone earlier on HN made a comment that the HK-Macau-Zhuhai bridge newly built was expressly designed to put Chinese tanks into HK in under 30m, which would easily stomp any resistance. That projection of power is also likely to deter any possible allies, as it's an indefensible position.
Sure, HK is a city as well as it’s a state, and you can besiege a city.
Doesn’t mean, under the hypothetical where someone went to war with China and HK allied with them, that that larger nation wouldn’t extract protections for HK from China as a concession, win or lose. It’d be an obvious “price of entry” for HK to participate in any such war. (Heck, I bet with the way things are going, if said ally was trying to recruit Taiwan to stand in rebellion, I bet Taiwan would also demand protections for HK as a concession, at the same time it was demanding protections for itself.)
Of course, in the mean time, the population of the city would probably have to evacuate to allied territory and only re-occupy the city after the war, lest they become an easy hostage for their allies.
Exactly this. Plus there's a PLA garrison in Hong Kong anyways. The bridge (and high speed rail to Kowloon) are about creating better links through the region, enabling further economic growth and creating a stronger sense of "one country"
> There is no need for Xi or China's establishment to do anything here. They will simply wait it out. Hong Kong is and always will be wholly dependent on its relationship with China. There is no end game where democracy and freedom wins and they secede from China and live happily ever after.
As I mentioned in other comments, the protestors know that the real pressure is from the “Hong Kong Human Rights and Democracy Act of 2019”, which China cannot ignore.
Currently, Hong Kong is extremely important for China in terms of capital flow: more than half of Chinese capital inflow and outflow go through Hong Kong [1].
If the capital flow is restricted, it severely hurts China, especially when she needs foreign capital where her credit expansion is unsustainable, not to mention the ongoing trade tariffs and the bigger ”new cold war” [2].
Many protestors understand that China needs Hong Kong much more than Hong Kong needs China (as for food, water, and electricity, Hong Kong may follow Singapore’s example in how she deals with Malaysia).
The protestors know this, that’s why they are supporting the “Hong Kong Human Rights and Democracy Act of 2019”, a bipartisan bill introduced by US Representative Jim McGovern and Senator Marco Rubio [3]. The bill demands true democracy in Hong Kong—universal suffrage for the legislative council and the chief executive—which is what the protestors want. I read somewhere that the bill is expected to pass by end of 2019.
In addition to real change in how elections will be done in Hong Kong, the bill specifically targets Hong Kong officials and business people who are restricting the democracy in Hong Kong and will freeze their assets in the US. It is fair to say that many business people who are pro-Beijing do so out of financial interests, so this bill will make them think twice before taking side. When the bill is passed, China also needs to choose: between worse financial access versus democracy for Hong Kong.
> What will most likely happen: the everyday people (shopkeepers, professionals, etc) who need to earn a living will tire of the endless disruptions currently paralyzing their streets and businesses. They will realize that the more radical elements of the demonstrations are undermining the very things that they are fighting for that make Hong Kong an attractive place for investment and international business in the first place: societal stability and the rule of law.
This was similar to my thought last month, that the protest might end like the Umbrella protest, losing support from the public. But judging from recent events, this is unlikely to be the case. One recent survey discovered that people are understanding the need for real disruption to achieve actual change (See [4] in Chinese), and the protestors know how to aim at the government without causing too much trouble for local businesses (unless they showed express support for Beijing over Hong Kong [5]).
They learned their lessons from the Umbrella protest.
Hong Kong is the largest source of overseas direct investment in the Chinese Mainland. By the end of 2018, among all the overseas-funded projects approved in the Chinese Mainland, 46.3% were tied to Hong Kong interests. Cumulative utilised capital inflow from Hong Kong amounted to US$1,098.1 billion, accounting for 54.1% of the national total.
Hong Kong is also the leading destination for China’s FDI outflow. According to Chinese statistics, by 2017, the stock of FDI going to Hong Kong accumulated to US$981.3billion, or 54.2% of the total outflow of FDI.
> As I mentioned in other comments, the protestors know that the real pressure is from the “Hong Kong Human Rights and Democracy Act of 2019”, which China cannot ignore.
As a sovereign nation, China can and will completely disregard anything the U.S has to say about what China perceives to be its internal affairs. This is completely consistent with the way China has always externally responded to foreign powers (including the U.S) taking such measures. In my opinion, this will be the case regardless of any sanctions levelled by the U.S. administration against HK or Mainland officials who they deem to be suppressing basic freedoms in HK.
Furthermore, the Act’s ultimate trump card (the suspension of Hong Kong’s special trade status should a national security law harming human rights be enacted in HK) would be a bit of a pyrrhic victory, would it not? I can’t see the termination of HK’s special trade status gaining popular support even from within HK as the damage it would do to HK’s economy would be irreparable.
Outside pressure is more likely to force China to double down on its position rather than concede an inch on what it believes to be a matter of national sovereignty.
> Currently, Hong Kong is extremely important for China in terms of capital flow: more than half of Chinese capital inflow and outflow go through Hong Kong [1].
> If the capital flow is restricted, it severely hurts China, especially when she needs foreign capital where her credit expansion is unsustainable, not to mention the ongoing trade tariffs and the bigger ”new cold war” [2].
> Many protestors understand that China needs Hong Kong much more than Hong Kong needs China (as for food, water, and electricity, Hong Kong may follow Singapore’s example in how she deals with Malaysia).
I think the economic importance of HK to mainland China is overstated here. The importance of HK has for the most part to do with territorial integrity.
First of all, China is not reliant upon foreign capital inflows. China’s public and private external debt is a paltry 15%~ of GDP [1] - one of the lowest in the world for an economy of its size. It is consistently among the world’s top three creditor nations [2]. The majority of its debt is internal, regional government debt, issued in local currency [3]. China has also accumulated massive foreign reserves over the years ($3T USD worth [4]) due largely to its trade surplus with the U.S.
In addition, simply looking at capital inflows and outflows to and from HK can paint a misleading picture on what is actually going on. The only thing the inflow and outflow figures show is that capital is being intermediated through HK as a base for investment into China. This can be partially explained by China’s quid pro quo policy of allowing foreign firms access to the Chinese market in return for partial IP transfers via joint ventures [5]. HK currently provides a safe, stable middle ground where these joint ventures can be domiciled but frankly, this is a precarious position and seems to be more of a product of historical circumstance and geographic/cultural proximity to the Mainland than anything else.
The other major driver of this capital movement is China’s preferential tax treatments of FDI, the most important of which are lower corporate tax rates and tax bases for ‘foreign’ investors. This created a loophole where Chinese businesses and wealthy families can ‘round-trip’ their capital through HK, sending it abroad then bringing it back again as FDI at favourable tax rates [6][7]. There are many other factors involved such as bypassing Chinese currency controls [8] and money laundering [9] -all of which are enabled by HK’s well-oiled financial system which has been facilitating these types of transactions since the very beginning. This has much more to do with Mainlanders evading taxes efficiently and foreign firms wanting to do business in China than China’s need for foreign capital or any kind of dependence on attributes exclusive to HK's financial system.
All of this is not to say that HK doesn’t contribute anything economically to China. But its whole existence is predicated upon the good graces of Chinese economic policies and foreign firms’ eagerness to gain access to the Chinese market. HK is not intrinsically economically significant or self sufficient. Contrast this to a city-state such as Singapore which has major industries other than finance such as electronics and chemical manufacturing, oil drilling/refining [10] and most importantly, proximity and partial control of the Strait of Malacca via the Port of Singapore (the world’s second busiest port).
> In addition to real change in how elections will be done in Hong Kong, the bill specifically targets Hong Kong officials and business people who are restricting the democracy in Hong Kong and will freeze their assets in the US. It is fair to say that many business people who are pro-Beijing do so out of financial interests, so this bill will make them think twice before taking side. When the bill is passed, China also needs to choose: between worse financial access versus democracy for Hong Kong.
Well, the bill will supposedly not be targeting business people since it’s not the business people who propose or enact the laws. Only the lawmakers will be targeted, and the lawmakers are ultimately beholden to the CCP. For the reasons stated above, I’m of the opinion that the passing or non-passing of this particular bill will be of little consequence to China. Tax loopholes can always be closed or moved, new preferential tax zones can be created, etc. It’s the foreign firms who will need to choose between HK or China. If a foreign firm is forced to choose between losing access to the Chinese market via HK versus interacting directly with China from a business hub like Shanghai, it will most definitely choose the latter. From China's perspective, the question of democracy is likely not even on the bargaining table.
> This was similar to my thought last month, that the protest might end like the Umbrella protest, losing support from the public. But judging from recent events, this is unlikely to be the case. One recent survey discovered that people are understanding the need for real disruption to achieve actual change (See [4] in Chinese), and the protestors know how to aim at the government without causing too much trouble for local businesses (unless they showed express support for Beijing over Hong Kong [5]).
I'm not entirely sure this is possible. The very point of protesting is to disrupt the status quo. They're not going to disrupt the status quo and enact change by allowing the city, its businesses and government to simply go on functioning as usual. But none of us can know the future so I guess we will just have to wait and see what happens.
It does, although arguably Hong Hong is hardly as big of the China pie as it once was. One day perhaps they decide it time to bring them into the fold.
The treaty promises that Hong Kong would keep its separate system of government until 2047, but I don't believe it specifies what happens after that. It's hard to predict what will happen, but I doubt if it will instantly become like any other Chinese city.
No, the plan is that when 2047 comes, Hong Kong will be just another Chinese city. That’s why Beijing is changing the school curriculum. And that’s why there were protests in 2012.
As not2b suggests, it's more nuanced than "Hong Kong is just another city by 2047".
Firstly, they're supposed to be separate for at least 50 years. The ambiguity comes in with determining how separate the "two systems" really should be. Are they allowed to specify the national curriculum? Are they allowed to extradite criminals?
After the 50 years are up, Hong Kong can potentially continue to act semi-autonomously as an SAR. (It's just not supposed to change until after that date.) Hong Kong's current status is economically advantageous to China, as companies have a place to make inroads to the large Chinese market in a business-friendly environment that typically respects the rule of law. The SAR is also given special economic status by some foreign countries, which would likely be taken away upon 'complete integration'. The integration that you're talking about is going to be a long process, and there won't be a singular point where it's clearly happened. So we shouldn't be surprised that China is making efforts to integrate now, but we also shouldn't be surprised by the resistance.
They've badly miscalculated. As the original SCMP article points out, their ears to the ground in HK failed to pick up, or convey accurately, the intensity of the broad public sentiment against the extradition bill.
That was especially unfortunate as, following the failure of the Umbrella Movement to produce results in 2014, the public's frustrations over mainland interference and tone deaf local politicians have been building. All it took was one big target to catalyze the populace. And for lack of information, Beijing allowed Carrie Lam to provide the spark.
Beijing certainly has a 30-year plan for Hong Kong, but the (usually pragmatic) regime needs to re-think how they approach the next decade
The top officials and the establishment of HK successfully created a bubble for themselves over the years, deceiving some people, but more worrisome, themselves as well.
That's my take of it.
When mainland affiliated media and publishers control much of the market, it's easy to be mistaken.
Not saying the British hasn't done the same thing during colonial rule, but we have the Internet now...
One thing that it left out here is to articulate which of the 30 some odd offenses, with a minimum 7 year sentence, would such an extradition would actually be considered. They're generally violent crime, and even before the protest started, some of the white collar crimes were removed.
This CE has been dumb as a post in terms of trying to rush this, and failed spectacularly in articulating the proposed change. The key fact being that the judiciary has been carried over intact, because the elites needs it for their day to day business, and it has on many occasion overturned what the HKSAR government had proposed.
There are far deeper problems with HK, many of which were carry-overs from the colonial days, that has not been resolved. Eg. housing prices has been high in the colonial days by design. The tax base was narrow, so the colonial government operated by jacking up land lease prices. The HKSAR government had mostly carried over the same practices, spare an unfortunately timed proposal of building new public housing right before the Asian financial crisis shortly after the handover. CE Tung took the brunt of that and no subsequent CE had proposed anything too serious. To be fair, the elites then and now includes lots of real estate tycoons, and unlike the governors of the past who are appointed by the Queen; the CEs now are voted in by small groups of electors that often are "business leaders".
Grey market goods had been a persistent nuisance, which is no surprise that one of the protests had been in that area.
Job market prospects has been quite bad for the post-secondary educated. Manufacturing started leaving in the 80s under the Colonial watch, and nothing substantial had been proposed to replace that then; nothing substantial had been done to fix that now under HKSAR.
There are lots and lots of reasons for HKers to be unhappy - earning a living has been tough, long commutes, impossibility of owning a place, lack of public / subsidized housing, and there's little surprise that they'd turn to chucking out whomever is running the place.
Compare that to the 80s and 90s: The first popularly-elected legistlator started in 85, after the Joint Declaration was signed in 83. But people had decent living, getting housing was tough, but not as tough. Mainlanders would bend over backwards if you start waving HKDs. There weren't massive protests then against the Colonial government.
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Even if what you said happens, it would temporarily cool down the chaos. People don't turn to chaos easily. Look at the US - it's easy to say the people voted for Trump are uneducated, bigoted. It's so much harder for people look a little deeper. Their livelihoods had been stagnant at best, manufacturing departed and left a vacuum, etc... They turned to something that promised to blow down the current order.
These problems needs real fixes, or the chaos would simply return.
1. Most of the technology we work on and with is manufactured in China
2. A significant fraction of engineers, especially in the Bay Area, are of Chinese heritage at some level. By extension, users of HN.
3. Things happening in China have an effect elsewhere, like the US.
I don’t personally like China all that much as a political or cultural influence these days, but that’s just me. Given that, it’s not smart to discount what’s going on there.
