City’s best days might well lie ahead
On July 1, 1997, China resumed the exercise of sovereignty over Hong Kong. This marked the culmination of Deng Xiaoping’s astute and visionary negotiations with Britain’s prime minister Margaret Thatcher in the preceding decade. These were essentially a frank admission by the British that earlier attempts to segregate Hong Kong from the motherland had been wrong — all along.
However, what was insisted upon and agreed by both China and the UK was not only that Hong Kong is an inalienable part of China, but that it was special in a number of ways. Hong Kong’s rule of law and independent judiciary, its economy and lifestyle, its efficient civil administration, high degree of autonomy and dynamic relations with the rest of the world. Hong Kong’s deep integration with the international community — in international trade and finance, culture, and regional ties — was already well developed. It was therefore a platform to build upon, not tear down.
So the raising of the Chinese flag and lowering of the Union Jack, amid speeches and applause, tears of joy for reunification and sadness for a bygone era, took place peacefully as a day of celebration for Hong Kong, China and for the rest of the world.
Thus, a great historic division became a huge modern reconciliation — a celebration of families coming back together as one, warm relations between Hong Kong and neighboring cities to the north, and most importantly, a new era of support and empowerment of Hong Kong from further north.
How can such bold claims be made? The answer comes from the centrality of Hong Kong issues. Hong Kong issues are weighted favorably by Beijing. The Chinese central government makes Hong Kong issues important ones to respond to and works tactically with Hong Kong entrepreneurs and politicians. This unique “one country, two systems” governing formula specially designed for Hong Kong means it can interact with any and all political leaders in China and around the world to advance its own interests.
There are other huge cities which frankly matter more in terms of their contribution to the Chinese economy, and of course, to public revenue streams. But Hong Kong continues to enjoy a privileged place in the national development and international diplomacy of China. This is remarkable both from a legalistic and pragmatic standpoint. The central government has kept its agreements and even offered enhancements to them.
Whenever there is significant contention in Hong Kong which it has difficulty in resolving, the central government has stepped in out of necessity to help with its resolution and move forward in an appropriate way that does not embarrass the local government on the world stage. This is of great benefit to Hong Kong. The unswerving and tactful support The author works on political economy and finance with a specialty in China, at the King’s College London Lau China Institute.
from Beijing is manifestly more constructive than London ever was.
Since 1997, the UK has remained a great friend of China and the Hong Kong Special Administrative Region. Thanks to Beijing’s magnanimity and openmindedness, the UK government and British commercial interests continue to be welcome in Hong Kong with one of its largest consulates-general and the continuing good work of the British Council. This again reaffirms Hong Kong’s importance as a leading financial and business center, and logistic hub, rather than the entirely negative notion, once bandied about by the international media, that Hong Kong has seen its best days and will henceforth decline due to its historic change of status.
Meanwhile the world’s best European Union and Asian companies are keen to use Hong Kong for their regional headquarters under its new style governance. For example, Chinese mainland, Japanese, UK, German, French and Swiss companies all increased their number of Hong Kong regional headquarters between June 2012 and June last year.
Hong Kong’s capitalist heritage, democratic traditions, tolerance, multi-cultural and multi-lingual society make it an ideal meeting place for international cooperation, entrepreneurship, cultural and intellectual exchange, social enterprise and much else. Like so many cities it faces challenges — income inequality, skyrocketing housing costs, inflation, youth discontent and political strife. But as the SAR approaches its third decade of self-rule its leadership has signaled its determination to tackle some of its most intransigent socio-economic and political problems through society-wide consensus building and genuine collaboration. This is with a view to addressing old issues with more creative and less provocative approaches.
The foreign press has a history of writing off Hong Kong at certain crucial stages of its evolution, be it over a change of sovereignty, major economic upheaval, momentous social unrest or health calamities. This time, however, it would be wise to bet on Hong Kong taking off economically with new vigor, propelled no less by its involvement with the Guangdong-Hong Kong-Macao Greater Bay Area development and the massive Belt and Road Initiative. Its best days may be in the not too distant future.