Reflections on a Summer of Discontent in Hong Kong

The summer of 2019, with all its compelling political drama, will certainly be remembered as a pivotal moment in the history of Hong Kong.

In the end, however, will 2019 will be remembered as a tragic turning point, heralding Hong Kong’s increasing instability and irrelevancy in the coming years? Or, optimistically, will future historians see this year as a moment when Hong Kong’s key stakeholders, inside and outside the city, were sufficiently reminded of the city’s special value and characteristics to do what is necessary to keep its “one country, two systems” dream alive?

The answers to this set of questions will have important implications for the national interests of the United States in the Indo-Pacific region.

 

A Hong Kong Consul General in the American Tradition

For me personally, it was a great honor to represent the U.S. government and American people in Hong Kong from August 2016 to July 2019. My top priority was the same as that of my predecessors—to affirm and reinforce the deep cultural and business ties between the American and Hong Kong peoples and economies. Those ties have stretched across time and distance, renewed by multiple generations.

I took inspiration in my work from the early history of America’s participation in the growth and modernization of Hong Kong. The U.S. Consulate General in Hong Kong has been open for more years than any other U.S. diplomatic mission in Asia. My reading of that history led me to two firm conclusions:

• First, the United States has long-term and abiding interests in this region, which have lasted for centuries and will continue for centuries to come.

• Second, America’s goals here have been remarkably consistent, despite many changes in leadership and technology.

Speaking at the opening of an exhibit on early 19th-century U.S.–China trade at Hong Kong’s Maritime Museum in early 2019, I noted that “the more things change, the more they stay the same.” A consistent core interest of the United States in the Western Pacific has been opening doors to free and fair trade with China and other partners—and Hong Kong has been at the center of all that.

Speaking on the hangar deck of the U.S.S. Ronald Reagan when it moored in Victoria Harbor in October 2018, I noted that for the past two hundred years, “America’s vision for the Indo-Pacific has been one and the same: a vision of open ports and open doors, and of stability and free commerce, with all nations committed to an open and fair architecture for commerce in the Indo-Pacific.”

America’s vision for the Indo-Pacific has been one and the same: a vision of open ports and open doors, and of stability and free commerce, with all nations committed to an open and fair architecture for commerce.

 

Why the United States Values Hong Kong

Hong Kong has long attracted American attention because its economy and governance stand out as positive models for all of Asia. The city points the way for others in the region by showing how open markets and good governance can reinforce one another, thereby creating prosperity.

Hong Kong is also remarkable for its respect for the rule of law—not just rule by law—for its independent judiciary and for its sense of fair play. These are all attributes that are made possible and sustained by Hong Kong’s high degree of autonomy, as codified in its Basic Law, which grew from the Sino-British Joint Declaration of 1984.

Hong Kong’s reliable common law legal system is indeed a key attribute that continues to attract new American businesses to Hong Kong, year after year. There are now close to 1,400 U.S. businesses operating in Hong Kong, significantly more than there were at the time of the “handover” of Hong Kong from Great Britain to China in 1997. Moreover, American firms, to a greater extent than European or Japanese companies, continue to favor Hong Kong for their Asian regional headquarters.

In the broader construct of America’s relations with the Indo-Pacific, particularly our relations with China, Hong Kong plays a crucial role in the fostering of teamwork by businesses, government agencies, academic institutions, media companies and cultural organizations.

It is also noteworthy that Americans and Hongkongers share a profound love of personal freedom, including freedom of expression. We have certainly seen that passion for personal freedom on display this past summer.

Hong Kong’s freedom of expression is why American scholars and journalists, as well as information businesses, appreciate Hong Kong so much, since it is a place where they can explore their ideas in relative liberty.

In short, Hong Kong’s core values—openness, fair play, freedom, respect for diversity and an embrace of internationalism—are the key reasons why Americans value Hong Kong so much. And those core values are also the reason why Hong Kong is, in general, such a success story.

 

Hong Kong’s Autonomy: the Foundation of Its Success Since 1997

America’s attraction to Hong Kong is thus based on Hong Kong’s distinctiveness within the Chinese system—which is, in turn, based on Hong Kong’s high degree of autonomy within China, as well as the overall integrity of the “one country, two systems” framework.

America’s formal relations with the Special Administrative Region are founded on the legal assumption that Hong Kong can and will retain its high degree of autonomy— except, of course, in matters of defense and foreign affairs—as guaranteed in the Basic Law.

This situation is a matter of American law, as enacted in the U.S. Hong Kong Policy Act. But it is also a matter of practicality.

Autonomy is the critical platform that enables Hong Kong to retain and maintain its liberal free market economy and its democratic aspirations and civil liberties, within the context of being part of the People’s Republic of China. Mainland China, of course, operates according to a very different system of governance.

Without autonomy for Hong Kong, its “capitalist system and way of life,” as the Basic Law provides, could not survive, and Hong Kong could risk being subsumed by “socialism with Chinese characteristics.”

 

Three Years in Hong Kong

When I first arrived in Hong Kong in 2016, I did a fair amount of listening. I consulted with a wide spectrum of people from the business sector and civil society, as well as the Hong Kong Government. I visited universities and met with NGOs. I started a public campaign to visit every district in Hong Kong. I met with every member of the Legislative Council and the Executive Council and the Court of Final Appeals.

After this intensive listening, I came away with a profound [sense] of the great strength and resilience of Hong Kong—of both its people and its institutions. However, I also came away with a profound sense of growing anxiety over Hong Kong’s future.

My first policy address, to the Foreign Correspondents Club in 2017, took as its central theme “Anxiety and Confidence in Hong Kong.” I gave similar remarks later that year to a Washington audience, titled “Risks and Opportunities in Hong Kong.”

Throughout 2017 and 2018, I endeavored to send a concerted, if nuanced message: The United States values Hong Kong, but sees negative trends. The starting point for Hong Kong’s level of autonomy is indeed quite high, I said, but the direction is worrisome, and the most important Mainland policymakers are showing less respect for the city’s distinctive characteristics and separate political space.

I also stressed that autonomy can be a “use it or lose it” proposition. I called on Hong Kong leaders to be more bold in the international space, and to use Hong Kong’s unique “demonstration power” as one of the region’s most successful societies to more powerfully benefit this city, the rest of China and the entire Indo-Pacific area, including the United States.

In my final year, however, Hong Kong saw continuing and worsening trends of diminishing autonomy, less confidence and elevated anxiety. This was no doubt a result of the accelerating tempo of actions, taken either by the Central Government or by the Hong Kong Government as a proxy, which seemed to undermine the high degree of autonomy under the “One Country, Two Systems” framework that everyone values. Over the course of that year, some noteworthy developments included the decision to allow Mainland criminal law to be fully applied in Hong Kong’s new high-speed train station; the disqualification of electoral candidates based on their political views; the outright banning of a political organization (a first for Hong Kong); the expulsion of a respected foreign journalist for hosting a speech by that same organization and the jailing of political activists for encouraging others to peacefully block traffic five years ago.

Then, in February 2019, I made a public statement that prompted pro-Beijing elements in the city to dispatch daily protest groups to the front of our Consulate building on Garden Road to demand my resignation.

Buried deep in a speech at the American Club, which was mostly about praising Hong Kong’s free market economy policy, I noted that “the Central Government’s desire to influence and control political conversations and events in Hong Kong could negatively impact the functioning of the economy and the international business community’s role here.”

From the perspective of a diplomat who had worked for 30 years on international economic affairs, this bland statement was self-evident. But it also directly challenged a certain key assumption of some important people in Beijing—the notion that China can both continue to benefit immensely from Hong Kong’s economic specialness, and at the same time work to bring the city’s political culture and patterns of governance toward greater alignment with Mainland Chinese norms.

Politics and economics cannot be so easily divorced. And subsequent events demonstrated that pushing for Hong Kong’s political amalgamation is a risky strategy for Beijing, which—to use the cliché—risks strangling the economic goose that lays the golden eggs.

Politics and economics cannot be so easily divorced.

 

The Extradition Bill and Resulting Protests

The hot topic of the spring and summer of 2019, of course, became the Hong Kong Government’s proposed amendments to its Fugitive Offender’s Ordinance, which would have allowed people in Hong Kong to be extradited to Mainland China and elsewhere for prosecution. This could have had a salient impact on Hong Kong’s business community and political culture.

The strongly negative and apprehensive reaction of the Hong Kong business community—which actually preceded the strong on-the-street response from the general public—illustrated the point I just made.

Economic performance cannot be separated from law and politics because law and politics shape governance, and governance shapes the economy.

Investors in the Hong Kong economy—whether they are local investors, foreign investors or Mainland investors, too—all want to see Hong Kong’s distinct legal system and rules remain intact.

I think the business community actually wants Hong Kong to be part of China and grow even closer to China economically, and thereby have a positive impact on the Mainland. The majority of individuals in the general public are also reconciled to the fact that Hong Kong cannot be separated from China. But they also want it to remain distinct and different from the rest of China, especially in terms of its political culture, legal system and societal rules and practices. In essence, they just want the status quo.

I think the business community actually wants Hong Kong to be part of China and grow even closer to China economically, and thereby have a positive impact on the Mainland.

 

Thinking About the Future

So, in this context, it is worthwhile to consider what Hong Kong, Mainland China and the United States can all do to help keep Hong Kong’s unique formula for success alive and well for many years to come.

Given this summer’s turmoil, as a matter of first priority, of course, the Hong Kong Government will need to make a concerted effort to reestablish public trust in government and in the police. The leaders need to demonstrate that they understand and support the desires of the city’s people, the city’s core values and the city’s social, political and economic challenges.

But the Hong Kong Government and other Hong Kong leaders need to do more than just respond to the immediate demands of the ongoing street protests. They need to send some clear signals about the future direction of the city.

Most of all, I believe, Hong Kong’s leaders need to demonstrate that they firmly embrace the idea that Hong Kong’s dual identity—as both a city in China and a place that is different from the rest of China—as an opportunity, rather than as a burden. And then they should make sure that the Hong Kong people trust and believe that their leaders will support and promote the city’s local best interests—not just the interests of Beijing.

People often remark on the difficulty the Chief Executive faces because she is beholden to two masters: both the leaders in Beijing and the Hong Kong people. And those two groups, of course, do not always want the same thing.

But I think it is more useful to look at things from the positive side. Hong Kong is both the most prosperous city positioned in the world’s largest nation, and a place that has its own special cosmopolitan identity, along with a degree of interconnectedness with the rest of the world that is unique in Asia.

As a practical matter, I would like to see Hong Kong actually double down, concertedly, on the notion of being “Asia’s World City.” I feel like the level of commitment to this idea has faded in recent years, as Hong Kong leaders have spent time echoing Mainland priorities. Hong Kong’s competitive strength, after all, lies mainly in its international character, not just its location in South China.

I would like to see Hong Kong actually double down, concertedly, on the notion of being “Asia’s World City.”

Of course, the stance and actions of Chinese leaders in Beijing, and Central Government representatives in Hong Kong, are also very important in setting events back on course. Put simply, my advice to them is this: Do not worry so much about Hong Kong. In supervising Hong Kong affairs, less would be more.

Although Hong Kong was once British, it is British no longer. Hong Kong is part of China. Beijing should be confident in Hong Kong’s future and in its positive role inside China.

No serious person or foreign government wants to see some kind of “color revolution” in Hong Kong. Indeed, foreign investors want to see a Hong Kong that is stable, rules-based, transparent, open and prosperous—a part of China but unique, and an easy place to do business.

One big concern I have about the Mainland approach to Hong Kong these days is what I sometimes call the “institutionalization of involvement.” The very size of the Central Government organizations that are tasked with monitoring and influencing Hong Kong affairs have grown to the point that there may be bureaucratic incentives that make it difficult for employees to follow the “less is more” approach to their work that I recommend. A concerted effort from Beijing to be more standoffish toward Hong Kong would go a long way toward calming nerves in the city.

Finally, let me say a word about U.S. policy and the U.S. stance toward Hong Kong.

Even while speaking clear-eyed truth about what it sees transpiring in Hong Kong, the United States should be very careful to avoid being a factor that precipitates loss of confidence in Hong Kong’s prospects. It is very important for Americans to be balanced in assessing trends there—and see the successes as well as the problems. After all, a couple million people marching on hot streets this summer clearly validated the fact that Hong Kong remains very different from Mainland China.

It is also important to remember America’s broad national interests in Hong Kong, ranging from trade and investment to law enforcement cooperation to educational exchanges, and to remember that Hong Kong is much more than just a venue for highlighting the comparative flaws in Mainland China’s policies and governance. I would like to see the U.S. Government make more positive and proactive and future-oriented efforts to support the city, through high-level visits and creative initiatives such as including Hong Kong in the Visa Waiver Program (for which it is already mostly qualified).

The people of Hong Kong and the people of the United States share a rich history, and we both benefit from our deep ties to one another. With effort, we can sustain and expand this relationship going forward.

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Ambassador Kurt W. Tong is a Partner with The Asia Group and was U.S. Consul General in Hong Kong and Macau from 2016 to 2019. Previously in the Foreign Service he served as Principal Deputy Assistant Secretary for Economic and Business Affairs, Chargé d’Affaires and Deputy Chief of Mission in Tokyo, and Ambassador for Asia-Pacific Economic Cooperation (APEC), among other roles. This article is adapted from a July 2, 2019 speech at the Asia Society Hong Kong which Ambassador Tong was required to give off-the-record.