Leaders must realize that globalization benefits HK
Bank of England Governor Mark Carney was the latest financial leader of international stature to warn of the unraveling of the world order that had been painstakingly established in past decades.
In a lecture at Liverpool John Moores University last week, Carney pointedly noted that globalization is increasingly being seen in developed economies, including Hong Kong, as being “associated with low wages, insecure employment, stateless corporations and striking inequalities”, according to a BBC report.
The rejection of globalization and the loss of faith in the free and open market are widely believed to have helped propel Donald Trump to the White House. Trump’s victory is said to have raised hopes of the euroskeptic right-wing parties in some European countries, par- ticularly Italy and France, coming to power in elections next year.
As an international financial center and regional trading hub, Hong Kong has benefited greatly from globalization which ensures the free flow of capital and goods. But, its people have become increasingly disillusioned by the widening wealth gap that’s already the highest among developed economies.
Business leaders, especially property moguls, have also continued to ignore the strain on the social fabric. Represented by the powerful chambers of commerce and other trade organizations, businesses have stiffened their stance against any proposal, no matter how modest it may be, to enhance workers’ benefits.
Even paying lip service to helping the poor is deemed by the city’s hard-nosed businesspeople to be too much of a compromise to their extremist free-market principle. The political system is structured in a way that bars populist politicians from ever gaining power. But, glowing public discontent is posing a serious threat to efficient governance.
Carney said something must be done to help those left behind by globalization so as to help restore people’s faith in free and open markets. To do that, economic planners “must clearly acknowledge the challenges we face, including the realities of uneven gains from trade and technology”, he said. “We need to move toward more inclusive growth where everyone has a stake in globalization.”
He’s not the first to have said that. The question is when the message will get through to Hong Kong’s business leaders.