Asia on the mind

Is Hong Kong over?

Let’s start with Hong Kong. When I moved to Hong Kong 25 years ago, in the millennium year 2,000, people would constantly ask me, “Has Hong Kong changed?” My first experience of Hong Kong was as a seven-year old in 1959, passing through on the way from the United States to Jakarta, where I lived with my family for the next three years.

Hong Kong then was a British colony, with the turn of the century Edwardian architecture common to Victoria, British Columbia; Wellington, New Zealand; Yangon, Myanmar (or Burma); Penang and Singapore.

Singapore had its Tiger Balm Garden; so did Hong Kong, both founded by the Aw family to promote Tiger Balm mentholated products that are still ubiquitous in Hong Kong and across Southeast Asia. The only very unmistakable memory I have of Hong Kong is Victoria Harbor, crowded with junks.

But the architecture is almost cookie cutter across the British empire of late imperial times. In Wellington, Victoria, Penang and Yangon it is well preserved. In Singapore and Hong Kong, it is nearly invisible, but when I visited Wellington for the first time, I did a double take, because it chimed with my memory of the Hong Kong of my childhood.

Most recently, the eminent economist Stephen Roach has taken up the question, what has changed about Hong Kong, primarily since the imposition of China’s National Security Law in 2020. In February 2024, he wrote an opinion article in the Financial Times, “It pains me to say Hong Kong is over” followed by an article in the South China Morning Post a few weeks later addressing the same question but answering it a different way, in “Why I am making ‘good trouble’ for Hong Kong”. He followed these up with another article in the Financial Times on June 13, “How my views on Hong Kong’s future have evolved”.

The problem is that Roach’s views haven’t really changed. His is a combination of the Wall Street view of Hong Kong, that there is nothing wrong with it that a boom in initial public offerings can’t fix, and nostalgia for the British colonial legacy of a city with strong civil liberties including rule of law, press freedom, and a promise of political outlets that was never realized.

It was a city where an international community felt at home and could thrive, particularly in finance (Professor Roach, now at Yale University, was chief economist and Asia chair at Morgan Stanley in Hong Kong from 2007 to 2012). It was a city where the Sino-British Joint Declaration of 1984 seemed to guarantee that there would be no change until the 50-year mark from 1997, the handover date, until 2047.

A few years after the handover, when I arrived, and for most of the next two decades until the protests of 2019 and imposition of the National Security Law in 2020, there was indeed, almost no change. In the hidden recesses of the Hong Kong Club in Central, the consensus view among the long-term expatriate bankers and retired civil servants was that there would be no significant change other than the extension of 50-year-leases on property, which is governed under a crown land system in which the government technically owns all land, with a few limited exceptions of 800-year-leases like the Shek O Golf and Country Club, which are too long to make government ownership meaningful.

It was a strange, transitional period, which I call Hong Kong 2.0, that period after mainland China had assumed sovereignty but was hands-off in terms of reminding people about it. A young generation grew up with no memory of the colonial period, unreasonably idealizing it as a time of freedom of expression and boundless prospects. In fact, the British colonial government exercised benevolent monarchy, gradually opening up the Legislative Council and 18 district councils to elections, monitoring the elite through advisory councils, and maintaining the laissez-faire economic management for which Hong Kong is famous.

The post-1997 Hong Kong government followed the playbook, but with several key differences. Its leaders looked to Beijing for the same kind of top-down leadership that Whitehall and London had provided, and when it didn’t come, they made things up that they thought Beijing would like.

They also did the things that were important for the money hierarchy that was left behind when Britain left, starting with the developers and their utility cash cows. So, infrastructure on a massive scale always went ahead. Institutional change was left behind or left out. Institutions that were part of the package under British rule like press freedom and the judiciary were left alone. The younger generation began to reinvent Hong Kong, building on their perceptions and misperceptions of British times, in a heady, brilliant and ultimately frustrated movement of local identity.

This period, with no change except the impossible, beautiful youth movement, like a children’s crusade that turned towards violence in the protests of 2019, is what is now mistakenly viewed as Hong Kong by Roach and others, not including the violence that began around June 2019. The flaw with this view is that on the institutional front – creating social links across the border with China to match the gigantic economic pipeline – nothing happened during this 20-year period. It was all saved for later.

Unfortunately, ‘later’ came in 2020 and the following years with the mass remanding in custody of protestors, charges against legislators, shutting down of Hong Kong’s largest newspaper, Apple Daily, and incarceration of its publisher and owner, Jimmy Lai. The list goes on, and the actions have done irreparable damage to Hong Kong, not least by inspiring expatriate flight and large-scale migration of local professionals who feared the national education schooling their children might face, in particular.

We have been in Hong Kong 3.0 since 2020, but is it the end of Hong Kong, as Professor Roach complains? Not really. The children’s crusade was doomed to fail. The middle class and elite were politicized, but not more than skin deep.

The judiciary has lost some, but not all foreign judges, which is seen as a measure of its commitment to British Common Law and the continuation of sacrosanct commercial stability. Over in the academy, human rights are still taught, foreign faculty are still hired without broad loyalty tests, and the generation of professionals that were trained in the West and remain friendly to it are still friendly.

The biggest change is the number and visibility of mainland Chinese in Hong Kong, which is not a sudden change but one that has come along gradually. And why are they here? Well yes, some are working for the Chinese Foreign Ministry or Hong Kong, the Hong Kong and Macau Affairs Office and the central government’s liaison office or are members of the Chinese Communist Party (CCP) embedded in state enterprises as well as private Chinese companies.

With about 100 million members, it is statistically unlikely that they would be absent from Hong Kong, even though a local CCP branch is still technically underground. Political parties in general, not just the CCP, have no legal status but are registered as social organizations.

Above ground or underground, the CCP has become more visible and influential in Hong Kong, and mainlanders are everywhere. One thing that has not changed is a local government that is intensely focused on pleasing Beijing. But Beijing has not replaced the Hong Kong government, which it could do within the boundaries of sovereignty. Its shadow government remains discreet, and the often expressed view that Hong Kong should be responsible for its own affairs is believable, because Beijing has more than enough on its hands running a nation of 1.4 billion. Finally, the mainlanders are here, by and large, for the same reason that most expatriates are attracted to Hong Kong.

And the ones I know feel like expatriates. Hong Kong is nothing like Beijing, Shanghai, Guangzhou or Shenzhen. All four are big cities under Chinese rule, but Hong Kong still wears that rule far more lightly than anywhere in the mainland. Cynics say, “Hong Kong has become just another Chinese city”.

I don’t think so. Hong Kong has become more like other Asian cities and territories, with civic representation but without democracy in the Western sense. Its virtues are those of Japan or Singapore, respect for authority, a low crime rate, openness to the outside world as well as embrace of tradition. Cities in China are just getting to the stage of middle-class comfort and expectations that Hong Kong has had for decades.

And at this baseline, Hong Kong is not over, but somewhere midway in its journey as a place and a society with its own aspirations if not agency. Remember that it only gained the status of city in 1842 when the United Kingdom founded Victoria City, the first urban settlement in the new colony.