How China is shaping the world through Hong Kong

China’s economy is too big, important and interconnected to the rest of the world to ignore.

China, a growing economic and military superpower, is confident enough now, through the recent enactment of the draconian Hong Kong Security Law and subsequent crackdown on the pro-democracy movement, to draw a line and force countries and businesses alike to choose sides between realism and ideology.  By Lee Kok Leong, executive editor, Maritime Fairtrade

China is a new global superpower with extensive political and economic influence all around the world.  The realism is that many countries and businesses are looking out for their own interests and are hopping on to the Chinese gravy train, to the detriment of the ideology of democratic values.  

China is offering access to the world’s second biggest economy and 1.4 billion population, soon to be the biggest economy in the world by 2028 according to a latest forecast, in exchange for turning a blind eye as Hong Kong loses its civil liberty.  China’s economy is too big, important and interconnected to the rest of the world to ignore.

Besides using carrot to entice the world, the Communist Party of China is also using a big stick to strike fear too.  The Security Law is vague and broad, thus virtually anything and anyone, even if they are not physically in Hong Kong, can be deemed a threat to national security, thus putting them at risk of deportation.  The law applies to both people and companies.  If found guilty, individuals can face life in prison, and businesses can get their permits revoked.

So, it is no wonder that many local and multinational companies have step forward to declare their full support for the Security Law, while there are also few others that have chosen to pull out of Hong Kong for fear of persecution.  Western democratic countries have come out in force to persuade China to change course, but to no avail.  

On the other hand, 53 countries at the United Nations Human Rights Council signed a statement supporting the Security Law.  The Communist Party of China has repeatedly said, rightly so, that the matter is an internal affair and no outside party has the right to intervene.  

In effect, China is using its formidable economic power as a form of political coercion to manipulate the behavior of others to achieve desired foreign policy outcomes, one of which is to conform to authoritarian rule.  As China consolidates its status as a superpower, drums up nationalism in citizens, and faces no real pushback, the world is seeing a more assertive and aggressive global player.  And what is happening in Hong Kong will become the new normal for the rest of the world, as they are becoming desensitized and more accepting of authoritarian rule.

Realism trumps over ideology

In a signal that can be interpreted as all is forgotten and business is as usual with China, the European Union, the same bloc that has previously condemned the Security Law, is signing a new investment deal with China that will make their economies more interdependent, according to officials on 29 December.  China is the second largest trading partner of the EU and two-way trade between them is valued at US$1.23 billion a day.  Undeniably, China is too big and important a market to give up over ideological difference.

In a survey by the American Chamber of Commerce in Hong Kong regarding the new law, respondents said they were pessimistic about overall business prospects.  However, this is just empty rhetoric as there is no mass exodus of foreign companies.  Only four in 10 of those surveyed are “considering” relocating from Hong Kong.  Moreover, Hong Kong’s local business community is reportedly not taking concrete steps in moving operations out of the city.

In the aftermath, there is a widespread government crackdown on the pro-democracy movement, including postponement of the Legislative Council elections, the arrest of media tycoon Jimmy Lai, activists Joshua Wong, Agnes Chow and Ivan Lim, among others, and the disqualification of four lawmakers, which prompted the entire opposition members to quit in solidarity.

Hong Kong Chief Executive Carrie Lam said Beijing’s sweeping crackdown in the city has strengthened law and order and improved its business environment.  “We now have a better and more stable environment for business to flourish,” she said.  This is true to a certain extent.  The large and often violent democracy protests and clashes with police that devastated the business hub for the past year had ended.  The Security Law has succeeded in restoring peace and stability.  However, the repercussions of the crackdown go far beyond law enforcement.  

Security measures can be implemented without compromising civil liberty.  By severely undermining civil liberties, including freedoms of speech, press and assembly, all ingredients to societal, economic and technological progress, China is putting a brake on Hong Kong’s pre-eminent status as a top global financial powerhouse which once rivalled London and New York. 

Yes, for now there is stability for businesses to thrive, however, this is not what China needs for Hong Kong in order to become a true superpower.  Hong Kong’s hard-earned reputation from the past hundred years as a beacon of free trade and a top financial center, well-respected by many, especially in the west, should be promoted as a shining example to herald the arrival of a great power.  History has shown, again and again, that economic prosperity cannot be decouple from civil liberty.

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