City can be a firewall amid country’s modernization
Among the variegated ideas and theories spelled out by General Secretary Xi Jinping in his work report to the 20th National Congress of the Communist Party of China, Chinesestyle modernization and “worst-casescenario mindset” are the two subjects that are most relevant to Hong Kong as I see it. Given the precarious geopolitical landscape created by the United States’ intensifying effort to curb China’s rise, Hong Kong must be ready to brace figurative high winds, choppy waters, and even dangerous storms in leveraging its distinctive superconnector role to assist the country to build a great modern socialist country.
Hong Kong’s superconnector role is an accelerator for the realization of Chinese modernization, with its stature as an international financial center and trade hub making it the ideal platform for attracting investment and capital from around the world.
Hong Kong can also serve as a firewall for Chinese modernization by helping to fend off external shock waves. Whether they are political headwinds, economic sanctions or financial warfare, Hong Kong inevitably bears the brunt of the hostility from the West. It is, therefore, imperative for the city to make contingency plans for the worst-case scenario so as to deter hostile attempts.
On the other hand, regardless of how the international landscape evolves in the future, Hong Kong’s advantageous geographical location and global reach will always make it the ideal strategic platform for the country to connect to the world in its globalization endeavors. Besides, Hong Kong can continue to serve as a role model for the reunification with Taiwan by ensuring the city’s stability and prosperity in the long run under “one country, two systems”.
As far as I understand, Chinesestyle modernization is a development path that takes into consideration the longstanding Chinese civilization, a path vigorously pioneered by the CPC and steadfastly supported by the Chinese people, with the objective of enabling the country to accomplish self-sufficiency, freedom, democracy and prosperity for the country, and ultimately reaching the highest level of human advancement. It has several unique features. First, it is a path of peaceful development void of the pillages that were a major feature in the modernization of many Western powers. The Russian-Ukrainian military conflict is a reprise of how the US advances its own self-interest in many ways at the expense of its NATO allies. It has also repeatedly wielded the dollar hegemony for its own gain at the expense of other countries.
Second, Chinese-style modernization is a way of giving back to the world by building a community with a shared future for mankind, a world vision that opposes self-centeredness and hegemony. China’s Belt and Road Initiative is a good example of the call for mutual benefits, co-development and common prosperity, and has therefore steadily gained traction among many nations, whereas the numerous cliques or military alliances championed by Washington serve no
purpose other than seeking to maintain its global domination.
Third, Chinese-style modernization not only upholds its socialist system but also constantly absorbs the good experiences of other countries in achieving outstanding socioeconomic achievements, especially learning the advantages of the market economy while averting its demerits. This has opened up a new form of institutional success since the reform and openingup process was in place 44 years ago, providing a lot of valuable takeaways for aspiring countries around the world.
Four, Chinese-style modernization entails continuous optimization of its institutional system without altering the original aspiration of the CPC to serve the people.
Last but not least, Chinese-style modernization is not to keep the country in seclusion; on the contrary, China will continue to open up on its modernization path to counteract the curb and decoupling threats from the West. That is where Hong Kong comes in to bridge the differences between the country’s modernization and the development path of the West. Hong Kong has kept intact its capitalist system that bears much semblance with the West’s system. Therefore, Hong Kong can do its part to demonstrate to the world how Chinese-style modernization can thrive under the capitalist system. No Chinese city can play a better role than Hong Kong as a superconnector between the country and the West, and this conforms to the original intent of “one country, two systems”.
Hong Kong must brace itself for the economic and technology warfare waged by the West as it stays at the forefront of these high winds, choppy waters and dangerous storms. For instance, the tariffs imposed on Chinese imports by then-US president Donald Trump were mostly headwinds, as were the moves made by the Joe Biden administration to restrict the supply of semiconductors and chip-making equipment to China, and to decouple from China.
We must be alert to the risk of economic warfare evolving into a dangerous storm, for instance, in the form of Washington weaponizing the US-dollar hegemony against China, including the special administrative region. If this happens, it will in effect unleash a full-scale “new Cold War” at the international level. Hong Kong is well-positioned to be a financial firewall for the country. The city therefore must review its financial system, including the linked exchange-rate system, to cushion the potential shock waves.