With future uncertain, will it be a happy ending for China- Hong Kong?

By: |
July 1, 2017 7:50 AM

China is celebrating 20th anniversary of Hong Kong’s return today, even as the future is uncertain.

Remember Bees Saal Baad? The whodunit 1962 Bollywood thriller with great music and edge-of-the-seat-drama kept all guessing and hooked till the end.

Remember Bees Saal Baad? The whodunit 1962 Bollywood thriller with great music and edge-of-the-seat-drama kept all guessing and hooked till the end. For China and Hong Hong, it’s bees saal baad-20 years since ‘one country two systems’, a grand and daring experiment that envisaged the compatibility of two entirely different political systems. Hong Kong reverted to China in 1997, after a settlement between China and Britain in 1984. The result is a thriller, keeping us hooked, as nobody quite knows how it will end. What is the writing on the wall?

July 1, 2017, will mark 20 years since Hong Kong became a Special Administrative Region (SAR) of China with allowances for it to retain its “capitalist system with executive, legislative and independent judicial power, including that of financial adjudication for 50 years from 1997.” For another 30 years (until 2047), Hong Kong will be under the rubric of ‘one country, two systems’. To commemorate the two decades, Hong Kong was spruced up with an estimated $114 million celebrations, capped by President Xi Jinping’s (first) visit where he will witness the swearing in of Carrie Lam as the Chief Executive of Hong Kong.

President Xi is scheduled to pay a visit to either the Hong Kong-Zhuhai-Macau bridge or the Guangzhou-Shenzhen-Hong Kong high speed rail link which will connect, hold your breath, Beijing with Hong Kong (in 2018). But, activists are already gagging the giant bauhinia flower (the emblem of Hong Kong) gifted by the Chinese in 1997. Going back into history, most part of Hong Kong, the new territories, was leased to Britain for 99 years from 1898. When the lease came to an end, the question was resolved under the auspices of the Sino-British Joint Declaration on the Question of Hong Kong (1984). Suddenly, an Anglophone, Cantonese-speaking Hong Kong found itself in China’s arms.

For China-in 1984 during the negotiations and later in 1997-Hong Kong was an ambition, a window to the world, a flirtation with the capitalist system and even a possibility for Taiwan’s integration in the future. For Hong Kong, it was cementing the informal economics in play between the island and the hinterland. Hong Kong, internationalised and dynamic, was to ‘lean to both sides’-the bridge between China and the world. For both, it was to be an experiment full of promise. But somewhere along the road, the honeymoon got over, and China and Hong Kong found themselves, as the Chinese saying goes, in the ‘same bed, (but with) different dreams’.

In the 1990s, Hong Kong embodied China’s aspiration: smart, efficient, English-speaking financial centre with a modern face. Today, China has had a makeover and has learnt the ropes fast, and Shanghai, Shenzhen, Tianjin compare well or even better, as some say, with Hong Kong. The equation has changed with China’s dramatic rise, no longer in awe of Hong Kong, as it once was. Even Disneyland in Shanghai (as compared to Hong Kong’s attraction Disneyland) is bigger, better and does higher business. There are more tourists wanting to climb the Oriental Pearl Tower (in Shanghai) than the Victoria Peak (in Hong Kong); more people in awe of Shanghai’s Bund than Hong Kong’s Harbourfront.

Is Hong Kong like the fading, ageing superstar caught in a sepia reel? That Hong Kong may be, but it has been responsible for China’s breakneck development. For example, China boasts of cutting-edge textile and garment industry, because of Hong Kong. In the 1970s, when nobody was willing to wager on China, the entrepreneurial Hong Konger’s began to move manufacturing to the adjoining Pearl Delta, ‘hollowing’ out its manufacturing to China what Singaporean economist John Wong has likened to ‘ front shop (in Hong Kong), back factory (in China)’. (Ironically, from ‘Hong Kongisation’ of China, it’s the now reverse-the ‘mainlandisation’ of Hong Kong).

But Hong Kong ticks, playing a more sophisticated role, as Hong Kong academic Simon Shen notes. Many of its well-known tycoons-be it Li Ka-shing’s investments (Hutchison Whampoa Ltd) in an American sphere of influence, i.e. Latin America; tycoon Victor Fung (Li & Fung Group) who became the chairman of the International Chamber of Commerce in 2008; or late tycoon Cheng Yu-tung (New World China Land) who became the honorary consul-general in Bhutan in 2004 (Bhutan does not maintain diplomatic relations with China)-are possible instances of Beijing’s ‘white glove’. Economists note that Hong Kong’s manufacturing contributed 30% of the GDP but, by 2000, contributed only 5%. Manufacturing has further slid from 1.6% of the

GDP in 2011 to 1.1% in 2015. Hong Kong’s service-oriented economy accounts for 92% of its GDP in 2015 (from 65% in 1981)-tourism and financial services depend on tourism from the mainland and on export of services to China. But affluent Chinese have upped their lifestyle and want to head to Gangnam in Seoul or Shinjuku in Tokyo over Tsim Sha Tsui in Hong Kong. As Friedrich Wu (Nanyang Technological University, Singapore) writes, “Be it financial services, entrepot trade or regional headquarters (RHQ) services for multinational corporations or be it the port, Hong Kong is being steadily eclipsed by Shanghai, Singapore or even a brash newcomer like Qingdao on the eastern flank of China (port).”

In tandem, besides the economic undercurrents, there has been sporadic unrest in Hong Kong. In 2003, half a million people took to the streets protesting against Article 23 of the Basic Law which allowed Hong Kong to frame laws to prevent treason, secession, sedition or subversion. In 2012, Hong Kongers protested with hunger strikes against China’s intent to introduce patriotic education in Hong Kong (on similar lines prevalent in China).

In 2014, young students camped out in vital arteries of Hong Kong calling for universal suffrage in electing Hong Kong’s leaders, the ‘umbrella revolution’. Early in 2016, the ‘fishball revolution’ saw Hong Kongers fighting for a sense of Hong Kong identity-fighting for hawkers and vendors who have been a part of its social landscape. Political words such as independence, self-determination and public referendum, largely misnomers in the 2000s, are now dropped by Hong Kongers faster than hot cakes and Ni Hao (Chinese ‘Hello’).

A lot of water has flowed under the bridge. China has ceded carrots like Closer Economic Partnership Agreement, CEPA (2003, operational in 2004), with zero-tariff access on goods originating in Hong Kong and Individual Visit Scheme, IVS (2003), to boost tourism in Hong Kong. The Pan-Pearl River Delta plan (2004) seeks to integrate nine Chinese provinces with Macau and Hong Kong (9+2). Seven cross-border projects, including the Hong Kong-Zhuhai-Macau bridge, are in the making.

But with the carrots have come sticks. The influence of the Liaison Office (Beijing’s foothold in Hong Kong) has been on the increase, so much so that critics call it a parallel government. Chinese property developers, ‘red capital’ on a roll, are buying land in Hong Kong. The New York Times (2017) noted that the share of land bought by mainland property developers has shot up from 6% in 2009 to almost 50% in 2017.

Hong Kong is feeling left behind. It has gone from full employment to unemployment of 3.2% (2017). Inequality has been rising from 0.537 in 2011 to 0.539 in 2016, and nano-housing or matchbox housing-small houses and high rentals-are breaking the backs of a younger generation and straining the social fibre. Finally, the twist in the story comes because Hong Kong might be the ageing, fading star (remember Amitabh Bachchan in Shahenshah in 1988?). But just as Bachchan woke up with a goatee and better films to win our respect, Hong Kong needs to reinvent itself.

Despite being an English colony for 150 years and 20 years of China’s embrace, the people keep pride as Hong Kongers, not Chinese or British. Sociologist Lau Si-Kai has chronicled the ‘breakdown of the unified (Hong Kong) elite in the transitional period 1984-1997’ to ‘elite fragmentation’ in the post-1997 period. But since, more than elites, it is the ones left behind shaping the story. Those born in Hong Kong in the 1990s or 2000s have emerged as a potent generation, willing to challenge the order, much to China’s surprise.

Some of these young Hong Kongers have incarnated as unabashedly localists, autonomists and separatists, seeking a public referendum on Hong Kong’s future in 2047. In a pragmatic economic formula of China-Hong Kong union, this was not meant to be. This has opened an unpredicted, unforeseen possibility of another story, another future-much to China’s discomfiture and one that may well surprise us all.

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