Hong Kong, RIP

In June 1995, barely two years before Hong Kong was to revert from Britain to “motherland” China under a landmark agreement, Fortune magazine ran a cover story that prophesied the “death of Hong Kong”. The naked truth about Hong Kong’s future, the article noted while taking a dim view of China’s promise to respect Hong Kong’s autonomy for 50 years, can be summed up in two words: it’s over. 

Since then, that Fortune article has been held up as an embarrassing example of journalistic soothsaying gone horribly wrong. Contrary to the author’s assertion, troops of the Chinese People’s Liberation Army do not “stroll the streets” of Hong Kong. Nor has Nobel Prize-winning economist Milton Friedman’s prediction cited in the article — that “within two years of taking control, Beijing will impose capital controls and replace Hong Kong’s independent currency pegged to the US dollar with the Chinese renminbi”— come true even to this day. 

After years of being mocked at for getting it so wrong, the magazine’s editors issued a mea culpa of sorts in 2007, on the 10th anniversary of Hong Kong’s handover, acknowledging, “Well, we were wrong.”

Perhaps they gave in a little too soon. 

More recent developments in Hong Kong, and the signals being conveyed by Beijing, appear to validate the central message of that discredited article: that as Hong Kong becomes a “captive colony” of Beijing and increasingly begins to resemble “just another mainland city”, it seems “destined to become a global backwater.” 

More particularly, there have in recent times been articulations of concern that Beijing has become much more interventionist in running Hong Kong’s affairs, reversing its initial position that it would respect the ‘one country, two systems’ arrangement. Under that formulation, Hong Kong was to be governed for 50 years as a Special Administrative Region with a high degree of autonomy, with Hong Kong’s people administering Hong Kong’s affairs. 

Simultaneously, Hong Kong, which serves as China’s premier international financial centre and its biggest shipping hub, has been unnerved by a master plan unveiled by mainland Chinese officials in March 2009 to develop Shanghai as a global financial and shipping centre by 2020. 

Chinese Communist Party officials have held out assurances that Shanghai’s rise will not eclipse Hong Kong, and that the two cities will serve as the “twin engines” that propel China’s economy. It’s also true that in the absence of a rule-of-law framework in the mainland that international investors look for, and given that mainland China has restrictive capital controls and a censorship mechanism that inhibits the free flow of information, Shanghai has a while to go before it can displace Hong Kong. Even so, disquiet in Hong Kong runs deep. 

Beijing’s manifest keenness to promote Shanghai as an alternative to Hong Kong, and its recent inclination to get more actively involved in Hong Kong’s affairs, can be traced to its fundamental distrust of Hong Kong people’s aspirations for democracy, and the ‘culture clash’ that arises between Hong Kong and mainland China, as a consequence of the different value systems. For instance, just last week, three Hong Kong journalists who had travelled to Xinjiang, the scene of ethnic clashes between Han Chinese and Uighur Muslims, were detained, handcuffed and beaten by police authorities, who added insult to injury by claiming that the journalists had “incited” a riot. 

Similarly, in June, an estimated 150,000 people gathered in Hong Kong to commemorate the 20th anniversary of the student protests in Beijing’s Tiananmen Square in 1989, which ended bloodily. 

Signalling Beijing’s impatience with such manifestations of Hong Kong’s independence of spirit, Communist Party officials are pushing for a more interventionist role in the region’s affairs. Earlier this year, a party official gave a call for a ‘second governing team’ for Hong Kong that would comprise mainland cadres (which would violate the spirit of the ‘autonomy’ provision promised to Hong Kong) and even questioned the concept of ‘complete autonomy’.

In this vitiated atmosphere, the announcement last fortnight that Hong Kong’s chief justice, who was seen as a symbol of the territory’s judicial independence, was seeking premature retirement has given rise to speculation about Beijing’s interference in Hong Kong’s judicial administration. Even the judge’s claims that he was only stepping down on personal grounds to facilitate a smooth succession haven’t sufficiently dispelled suspicions that Hong Kong’s rule of law is at risk from mainland meddling. 

All this bodes ill for Hong Kong. If it loses its status as China’s premier financial and shipping centre and its reputation as a place governed by rule of law, it risks losing the three pillars that distinguish it from any other mainland city — and define the core of its identity. It would also mean that the Fortune article’s prophesy of its death might yet come true, slowly but surely.