25th anniversary of the establishment of the Hong Kong Special Administrative Region

Professor Kerry Brown

Hi, everyone. Welcome – a very warm welcome to this Chatham House event. Today some of you have probably seen, in the news, Xi Jinping, the leader of China, has been to Hong Kong to celebrate the 25th anniversary of the establishment of the Hong Kong Special Administrative region. So this is a good moment for us to reflect on the meaning of this particular event, and also to think of where Hong Kong might be a quarter of a century after reversion of sovereignty from Britain to the People’s Republic of China. Of course many events have been happening recently, and there’s been, you know, a kind of lot of changes, some expected, some definitely not expected. So we have a good panel, who are going to be able to think through some of these issues with our audience. We will have an opportunity for questions to the panel, and if you – if I could invite you to put any comments and questions, in the function provided, we will be able to come to those after our speakers have made some initial comments.

First of all, therefore, I’d like to invite Ben Bland, the newly arrived Head of the Asia-Pacific Programme at Chatham House, from a previous career as a Journalist, but also working in Australia and elsewhere, in the Asian region, and long familiarity with China, and the Hong Kong issue. Ben, over to you, please.

Ben Bland

Thanks, Kerry, and hi, everyone, it’s good to be here. I just want to set out, I guess, at the start, some background and in terms of how we got here, to give us a sense of maybe where things are going. One country, two systems, which is the arrangement by which Hong Kong is governed, and has been since the handover of sovereignty in 1997, from the UK to China, was I like to think of it, as the world’s most ambitious real-time political science experiment.

Can a relatively free and somewhat democratic city quasi state, survive as part of the world’s largest dictatorship effectively? And I think, when we think the inherent tensions in that, you have to believe that it was always unlikely that freedom, autonomy, some semblance of democracy, could survive in Hong Kong, so long as it’s part of an authoritarian and centralising system. And obviously, a lot of those authoritarian and centralising instincts have become enhanced in the last decade or so, since Xi Jinping came to power, as Kerry has obviously written about on a regular basis. But I think those fundamental tensions at the heart of Hong Kong were there from the beginning, and if you look back at the basic law of Hong Kong, this mini constitution, as some people call it, you can see things in there that, you know, Democrats in Hong Kong would like to think of as quite democratic and sending Hong Kong on a path to becoming almost a fully-fledged liberal democratic city. And you can see other elements of the kind of fundamental basic law there, which, are quite authoritarian in flavour, or at least could be implemented in that way.

Now, we are where we are today, 25 years on, and I think some observers would say that it’s surprising that Hong Kong stayed as free as it did for so long. Certainly, I was a very young person when the handover happened, and I wasn’t in Hong Kong. But having spoken to quite a few people who where there at various different functions, inside government and civil society, there was a fear that on July the 1st 1997, you know, that the PLA might, as they moved into Hong Kong, there might have been direct control imposed on Hong Kong, and that didn’t happen. And some elements of quasi free elections, a relatively vibrant media and civil society existed in Hong Kong for quite a long time, maybe for 20 years, but at the same time, it’s true that the deterioration of the last few years has been dizzyingly rapid.

I published my first book about Hong Kong, Generation HK, five years ago, in 2017, to coincide with the 20^th anniversary of the handover. And in the conclusion, I kind of argued that Hong Kong was heading for a greater conflagration because the young people that I interviewed for my book, were so unhappy with the way their identity and way of life was being threatened, in their perspective, by Xi Jinping’s China, that this was not heading to a good place. Because on the other side, I think the Chinese Government felt that it was losing control of Hong Kong and the way in which young people expressed their identity and their political beliefs was a direct threat to national security. So I could see things were heading in a bad direction, a vicious circle, but I didn’t imagine it would spiral as quickly as it did.

The last thing I’ll say is that the external situation really matters, too. So, one driver has been how Hong Kongers feel, one driver has been these, kind of, centralising and authoritarian instincts and the, kind of, greater historical desire of the Chinese Communist Party and government to, kind of, reintegrate Hong Kong. But the external situation has had a really important role to play, I think.

Hong Kong thrived in the past, partly as a place where you could do things that were not allowed in mainland China, or that were illegal in mainland China, in economic terms and in terms of journalism and civil society. But it also thrived in some sense, as a bridge between the West and China, that’s in terms of economics and trade and investment, and also, flows of people and ideas, too. And that – Hong Kong really thrived at a time when there was a sense that the West and China were coming closer together.

Now the geopolitical tensions that we see in the world today, they’ve really added to the pressures that are tearing apart Hong Kong society and pulling away at the fabric of Hong Kong’s system. So, in a way, while businesses could profit in the past, acting as a bridge, now they face pressure, both from the Chinese Government, and the Chinese Communist Party, and from the West, to fall into line with different views of what they should be doing. So I think that makes the business situation particularly tricky and it means that things that made Hong Kong successful in the past, those conditions have now shifted, putting not just Hong Kong people in a really difficult place, but I think Hong Kong’s economic future, too.

I’ll leave it there, and look forward to what everyone else has to say, thanks.

Professor Kerry Brown

Great, thank you very much, Ben. So our second speaker is Evan Fowler. He’s a Writer and Commentator, on Hong Kong and China issues, and has an affiliation with the Henry Jackson Society, but today speaking on his own behalf. So, Evan, over to you.

Evan Fowler

Well, thank you, Kerry, and it’s also nice, I have to add, to be on a panel with some old familiar faces, so, you know, I was very happy to be amongst everyone here. No, I mean, obviously it is 25 years, we are halfway through, you know, the SAR. And I was around in 97, during the handover, and I remember very distinctly, you know, it was raining, I was standing on Nathan Road, I had other members of my family, who were perched in different parts of, you know, what was an ending colony. Some in hotels, some in restaurants, some on the harbour front, some in other places, but I was actually a relatively young man, with my friends, on Nathan Road. And what I remember very distinctly, was, you know, the feeling at the time, was it was very mixed. You know, and I think the, you know, inherent, sort of, contradictions of Hong Kong, you know, perhaps those, sort of, long-term frictions between, you know, what Hong Kong was, as a reality, and I think the way, you know, Hong Kong was viewed, not only by China, but, you know, also by Britain, was behind that.

And, you know, what I think is becoming very worrying in Hong Kong, as we now enter into another 25 years, is that there have been really quite significant changes, not only within the last few years, where I think there has been a lot of reporting, and, you know, understandably a lot of concerns. But, you know, in what I see actually as some of those inherent fundamental contradictions in Hong Kong, between being a Hong Konger, between being Chinese, and frankly, being free to decide on your own identity, to being slowly incorporated into not just the PRC, but very specifically, you know, a Chinese identity and a China that has also changed very, very substantially, you know, under Xi Jinping.

And I think really, you know, behind a lot of the process that we, you know, have been both in 2014 and later on, in 2019, isn’t just the call for values, it isn’t just a call for sort of democracy, you know, the reality was, you know, Hong Kong wasn’t democratic. But it was a country, which – it was a – not country, certainly not a country, but it was a place where they were still, sort of, very much, they were liberal ideals, they were certain freedoms, they were certain core freedoms, including, you know, how we identify it, that defined Hong Kong, and I think we’re seeing that lost.

Now, one thing which I think is particularly sad, is, you know, I think back and I think of one of the big differences between the Hong Kong I grew up in, and I think the Hong Kong, which is slowly, slowly being lost, was that with my family, we would meet like a lot of Hong Kong families, and we would sit and we would talk, we’d play mah-jongg, and you could talk freely really, about everything.

Now, when I would go and visit my family across the border, you know, outwardly, everything seemed quite free, but one thing that was apparent, even for a small boy, was that, you know, that there was a certain self – a certain degree of self-censorship, there were certain constraints that people, sort of, realised they had to operate in. And I think what we’ve sadly seen, you know, certainly since the national security law, are that, you know, at one level, you’re seeing, you know, sort of, official constraints, you know, clear red lines or less clear red lines, sort of, being put in place. But I think you’re also seeing a society that is changing fundamentally because they’re no longer able to know, you know, what they can talk about, how far they can take certain conversations, certain thoughts. That in itself, changes, you know, the environment in which information is understood in Hong Kong, going forward.

So, even if, you know, you had certain people who sort of say, “Oh well, you know, Hong Kong may end up like China.” It won’t, it’s not in China’s interests for that to happen. There will be two systems, but even if you get the BBC, even if you get voices reporting, you know, if you change the information environment, if you change the ability of people to discuss and to talk freely, not just at high circles, but on the streets, you know, you change the way that information is understood. And I think we’re, sort of, seeing that in Hong Kong, so, you know, sadly I think moving forward, I think for the first 10/15 years, one country, two system worked, I think it then faced challenges. I would have hoped, you know, that China would have dealt with those challenges in a different way, that hasn’t played out.

And I think moving forward for the next 25 years, you know, I think Hong Kong is going to be, even if economically, certain things will be preserved. You know, I think as a society it will be a fundamentally different society and that will affect, you know, everything from doing business in Hong Kong, and, you know, I think the potential direction that Hong Kong will take as a city.

Professor Kerry Brown

Thank you very much, Evan, that’s some sobering thoughts, so really appreciate your personal perspective. Just before Christine speaks, could I invite people to use the Q&A function, which is at the bottom of their screens, if they have any questions, it’d be great to have people’s interaction and questions and comments on the panellists and on this issue. So, now if I can invite Christine Loh, currently at Our Hong Kong University of Science and Technology, working on the environment, but a former Legislator, with a distinguished career, and a former Under-Secretary for the Environment. Christine.

Professor Christine Loh

Thank you, Kerry. Perhaps I can also share something that is personal, because I think that affects those of us who are from Hong Kong. I was born in British Hong Kong, very much a colonial product. I attended school in Hong Kong and in the UK, and in the – my father came from Shanghai, as part of that great wave of refugees. And they came because things were not going so well on the mainland. So I think my personal background very much – is very much the same as many other people. And when I was growing up, the idea of China was just kind of not there; parents didn’t really want to talk about the past. I knew why they were in Hong Kong, because they couldn’t be in China, and somehow, you know, generations of people swimming over to Hong Kong, and I met a fair number of them, that they came from Guangdong, Guangdong was very poor, that’s why they were in Hong Kong. So you know, Hong Kong, but I was Chinese, Chinese families, British background, and yet, Hong Kong, the identity of Hong Kong, which Evan’s talked about, was contested. You know, I mean, what are you really? And also, we need to remember that we lived through long periods where our own nationality, did we belong to Britain? You know, what really were we?

Now, of course, the narrative in Hong Kong was always well, actually, you’re in a free place, and look at all these people coming from China, and, you know, China was not free. So the notion of freedom was very important to us. We felt that, you know, that’s the kind of lifestyle we wanted.

Also of course, through the 60s, 70s and 80s, Hong Kong social economic advancement was proceeding ahead. You know, so, for many Hong Kong people of my era, we felt that the future would be better and then, in the 1980s, then I was a sort of a young adult, and we were going to go back to China. I became more politically conscious at the time. I was with a group of people who were politically minded. We talked about the transition, and why it was really important for Hong Kong to have a degree of democracy, more democracy than we had under the British, and it was very late in the day, that we had any kind of elections at all. And we thought that at the time that having a democracy was important, because then our leader, who would lead Hong Kong, would – the legitimacy would not come from appointment, but would come from election. And then that would give us a way, a kind of shield to perhaps deal with the all-powerful Beijing. So that what we wanted was that the Hong Kong leader would be able to defend Hong Kong’s interests.

Now, unfortunately, I think over time, this notion of being a shield, I think from Beijing’s point of view, turned into a potential sword. And, you know, I think Evan’s talked about the years of – and also Ben talked about young people and how they felt and, you know, I’m not going to go into any details for now. But just to say, that the perception of the last few years of politics, and I don’t mean – I mean before 2019, that the notion of more democracy or freedom, became a sword that was threatening to the Chinese regime. So I think we need to, kind of, just bear that in mind.

Secondly, has Hong Kong has a role for finance and commerce, and I think we all agreed that it is essential that we have trustworthy contract law, the courts, and arbitration systems are strong. And up until today, I still think that that system has survived. So I think the issue going forward, and I’m sure this will be a topic of discussion, is what does national security mean? Because that lies at the heart of the current debate.

Now, as far as national security is concerned, and I think for China, they use, if I can use the word, the label of patriotism, and Deng Xiaoping, back in the 1980s, was always concerned about patriotism, and I think from the mainland is, are Hong Kong people sufficiently loyal to the concept of Hong Kong becoming a fully part of China? And then you can different policies, your day-to-day policies can be very different. They don’t have to be socialist in nature. But however, the sense that that has morphed into something that threatens the Chinese regime, I think it’s very real on the mainland, you know, whether people in Hong Kong agree with that or not, it is very real. And I think we’ve failed to deal with giving Beijing a sense of comfort that we don’t want to overturn the regime.

So the last thing I want to address is, now China’s concept going forward, is for Hong Kong to be more integrated into the mainland. And it is through obviously, the immediate neighbourhood of Shang Gong and Guangdong, which is the Greater Bay area. And I would just say that, you know, less than a year ago, the Hong Kong Government talked about a big development project in Hong Kong, the Northern Metropolis. And, you know, it was actually quite well received in Hong Kong, and I suspect there is a strong sense that in Hong Kong society that that kind of thinking of Hong Kong being part of a greater region, actually makes sense. Now what policies you are going to have, how that’s going to happen is another matter.

And then the last comment I just want to make at this stage, is Hong Kong frankly, is collateral damage, to the US-China, or US-Western powers, this is a big power contest in the world, and as we speak, Europe is going through, I think, a lot of different changes, as well, in terms of the Russia and Ukraine crisis, and US and China relations and Hong Kong is squeezed in the middle, so to speak. So I think that is a big part of the nervousness in Hong Kong. And also, the defensiveness of our system, how are we going to deal with perhaps this wave of anti-China feeling, also in the world?

Professor Kerry Brown

Great, thank you very much, Christine. So, before I open to the audience, we’ve only got one question, but it’d be good if any other questions could be fed in, and it’s an important issue, so I’m sure there’s plenty to ask. What I wanted to ask you all is a, kind of, sort of, rather selfish question of mine, so I think I’ll abuse my position as Chair, and ask it, just ‘cause I’m just interested.

I’ve always been puzzled by this idea of what are Britain’s obligations after 1997? We produce these biannual parliamentary reports, and are meant to do that until 2047, and we often speak in the UK, you hear people talk about Britain’s obligations, and I suppose I’m sort of wondering what those now are. Firstly, because if we say we have obligations under international law, what Britain or the British Government is currently proposing about, for instance, the Northern Irish Protocol, is obviously putting a bit of a question mark over that.

I mean, is it really that we’re observing international – you know, is that our main, kind of, reason for being involved in this, do we have moral obligations? Or do we have any obligations at all now? I’m just, sort of – your perspectives on what you individually think Britain’s continuing role is or if it has any continuing role, would be really, really helpful. Maybe – well, if I could ask Evan, first of all, and then Ben and then Christine, what would be your views on this?

Evan Fowler

I have views, which I think may not align with many people in the process movements and that is to say, you know, I think Britain’s obligation was an obligation towards the BNO. I think, you know, Britain has actually offered a very generous scheme for, you know, the BNO visa scheme. But, you know, obligations, and we think about sort of moral obligations, I mean, I don’t, sort of, buy the argument.

I mean, you know, the thing is, you know, yes Britain has a historic connection with Hong Kong, but Britain has a historic connection with many other places, and many other places where, you know, I think there is an equal suppression of, you know, I think core values and core freedoms that, at least in Britain, we consider to be important. You know, I mean, to me, I think if Britain were to see that it had, you know, such obligations in Hong Kong, it would be very difficult for Britain to, let’s say, act on any of those obligations, without genuinely interfering in Hong Kong and in China. And I think that would ultimately be counterproductive, and the last thing we should be doing.

But that leads me to something which does concern me, in Hong Kong and that is, you know, Britain has – it wasn’t in Britain’s interest, for events to playout as they have in the last few years. It was very much in Britain’s interest, politically, and, you know, very much the business community, for one country, two systems to work. There’s obviously some very, very serious challenges to that and, you know, the official line that is coming out from the Hong Kong Government, and that is very much being promoted in Hong Kong at the moment, is to say that, you know, the problems in Hong Kong are somehow, you know, to, sort of, borrow what Christine said, you know, Hong Kong is stuck in, you know, it’s a geopolitical football that’s being kicked around.

I actually think it’s very easy to make more of that argument than really exists. At the same time, you know, what’s happened in Hong Kong is being blamed on foreign interference. I read yesterday, you know, in China Daily, which was new to me, that I know that the official line constantly, sort of, bangs on about foreign interference and foreign powers being involved in, you know, almost any, sort of, dissent, major dissent in China. But apparently, now one Commentator was saying even the Mong Kok fish-ball protests, you know, the CIA and the US was behind that.

Now there was a time in Hong Kong where the role of the Hong Kong Government and the role of the institutions, which I totally agree with Christine, you know, those are the core things. Those are the things we should be concerned about. You know, they would have looked on things like this, and sort of said, “Well, you know, there’s a reason why this is not being picked up by voices or the major reputable news agencies. There’s a reason why the FT is not saying that, that the protests are being organised by, you know, by foreign forces” because there’s no evidence of it. And it’s deeply worrying that the Hong Kong Government and major people, you know, significant people, influential people in the community in Hong Kong, whether they believe it or not, feel they have to come out and say this, and believe this. And to me the concern here is I, sort of, look and say, okay, if Hong Kong is stuck between the US and China, and we look at their narratives, you know, I mean, I think we’re all on the same ballpark, when it comes to thinking about you know, Donald Trump and the particular tone he took, which was, you know, massively counterproductive. But, you know, let’s not forget that I think the Chinese have also rolled out a narrative that that is very difficult to counter reasonably.

So, yeah, anyway, sorry to be a bit negative on this.

Professor Kerry Brown

No, it’s very helpful, actually, so it’s an important question, and I see that’s a totally valid perspective. Ben, what do you think about Britain’s responsibilities?

Ben Bland

Well, I think Britain has many moral obligations, in a moral sense, for lots of problems it helped create all around the world. And I have been somewhat uncomfortable with some of the tone of the commentary on Hong Kong, as Evan said, the UK never did give democracy to Hong Kong itself, but just that doesn’t mean that Hong Kongers ought not, as people in the world, have the right to express their own views and identity and everything else. So I don’t think that’s a debating point against Hong Kongers, but it’s a reaction of fact. But I do think that it’s been good to see the British Government offering BNO passport holders, you know, the right to live in the UK, something they denied them for a very long time before. I think that’s good, so people who do feel very uncomfortable in Hong Kong, in their tens of thousands, are being, you know, welcomed in Britain.

I think that’s important, just as a matter of fact, but it’s interesting to see that one of the last kind of connections, I don’t know if it’s an obligation, but concrete connections, which was, you know, the presence of UK Judges on the Hong Kong quarter final appeal, that’s been sort of dissolved recently. They were withdrawn, yet in co-ordination with the British Government, because of a sense that there was an apparent – yeah, a perception of endorsements of an administration that has been, kind of, supressing freedoms and rights and the rule of law in Hong Kong. So there really isn’t much concrete connection anymore, to be frank. And ultimately, I think while yeah, there were young Hong Kongers and old Hong Kongers at various points, in some of the process in the last few years, who waived the Union Jack flag, or the old Colonial flag, at protests. I don’t think that was ever really because they expected the British Government to bail them out, or help them. It was just to, sort of, to stick two fingers up to the Chinese Government, which, as Christine was suggesting, may or may not have been good tactics. But I do think people knew what they were doing, and they weren’t calling on Britain to save them. I think it’s more as Evan was suggesting, it was a kind of Hong Kongers finding their own voice, to find their own, kind of, expressions of autonomy and identity, that don’t really in the end, have much to do with Britain.

Professor Kerry Brown

Great, thank you, and Christine. So you’re obviously, physically, or you’re based in Hong Kong, though I know you’re not maybe there at the moment, what do you think our obligations are? Do we have obligations as British, or you think it probably is no longer the case?

Professor Christine Loh

Well, I’m kind of in Evan’s school, in the sense that I think it’s all very nice to talk about our moral obligation, from the British perspective, but, you know, I stay away from that, because then you owe a lot of moral obligation to many people, and perhaps many other places that are in much more dire straits than Hong Kong.

But I think one of the things that Britain also has to do is think long-term, as a national interest, of what relations do you want to have with China? And, you know, it’s beyond my pay grade to really go into that, but I would just say that in a way, Hong Kong people of this generation, I mean, you know, people who are there now, are fortunate in the sense that if they wanted to leave Hong Kong, there are now quite a number of channels for them, legitimately to leave.

I’m not advocating for people to leave, by the way, but for people who do want to leave, the BNO arrangements, as well as, I think, arrangements coming from Canada and a number of other countries, are enabling Hong Kong people who have to leave, to have a channel to depart. But for those of us who are staying, and want to see improvements and progress in Hong Kong, and also betterment in China, I think this is where perhaps I’m a little different from some other people.

I tend to believe that any country at any moment in time, there are things we like or don’t like about it, there are new leaders that will impose new policies that we don’t like. But nevertheless, on the long trajectory of what we want our country to achieve, to want betterment for China as a Chinese national, I think that is also an acceptable position. And that’s where I am right now, and, you know, my work is in the environment, and I think that’s a very important area, going forward, for Hong Kong, for China, you know, for the planet, and better relations, where countries can still work on some of these major issues. You know, COVID, environment, climate change, I think remains good causes. So how can the world actually – and whether Hong Kong can play any role in making improvements on the ground, in these areas, that will help our country and Planet Earth, to advance.

Professor Kerry Brown

Thank you. Great, thanks very much. So broader perspectives, so to one of the questions, so yeah, please, and members of the audience, you know, put any questions you have in the Q&A. So the first one is from Peter Headen about the – “Do you think – does the panel think that the loss of political freedom will lead to the loss of Hong Kong’s economic advantages? And if so, will this be to Singapore’s going?” Ben, I think you used to be based in Singapore, didn’t you, before – no, you were based in Singapore in the past, I believe?

Ben Bland

Yeah, I have lived in Singapore, correct.

Professor Kerry Brown

Then maybe why don’t you have a stab at this, first of all, do you think that might happen?

Ben Bland

Well, there’s two separate questions, right? One is, you know, what happens to Hong Kong’s economic advantages, the other is, is Singapore a kind of net winner from that? On the first, I mean, I’m not quite as bullish as Christine, about the rule of law, as it applies to commerce. I think the truth is, most businesses, and whatever tech they’re in, don’t really care about democracy, to be honest, but they do care about stability. And I think when you have the, sort of, political pressures that Hong Kong has, on the justice system, on the government, I think it’s quite risky, to be frank, that’s number one.

Number two, I think we’ve seen that the Hong Kong Government has just struggled to administer Hong Kong in an effective way. You know, there’s the famous line about ‘all political careers ending in failure’. If you look at Hong Kong Chief Executives, that’s even more so, and it’s failure within, kind of, almost one term, for most of them. Basically, because it’s an impossible job, and lots of things, in terms of the basic governance of Hong Kong, are stuck, because of the political situation, and whoever you blame for that. That’s not a good environment for business.

I think the last thing I’d say is, it’s just partly a reflection of how China’s changing, the business environment in China is changing, and is going to inevitably be reflected in Hong Kong, that foreign businesses in China and Hong Kong have found it tougher and tougher in the last few years. There’s been explicit policies, you know, designed to tilt the playing field more in favour of domestic companies and there have been various domestic companies that have had their own problems in the Chinese economy, because of various things that have come from the Central People’s Government.

So I think it’s definitely got harder for prime businesses in general, I think you’d expect to see that reflected in Hong Kong, but – and this, I think, reflects another question that’s been asked, so long as China doesn’t open up its capital account, Hong Kong’s going to remain a really important valve for flows of money into and out of China. And so, there’ll be money to be made, kind of, tapping that hose of cash, basically. And as long as you have things like a very low tax rate as well, I suspect businesses can live with a certain degree of instability, a certain degree of a lack of confidence in the rule of law, and it depends, you know, who your legal cases area against. If it’s two foreign banks suing each other, it’s fine. If it’s a foreign bank that wants to sue a Chinese SOE in Hong Kong, are they going to have confidence in the long-term, kind of, fairness of that system? I doubt it.

Just briefly, as to whether the Singapore, kind of, benefits from that. I think it will be hard because Hong Kong has already become a centre for doing business with China, and Singapore is not going to compete with Hong Kong, as a centre for doing business with China. Singapore is really a centre for doing business in South East Asia, and some parts of the rest of Asia. So I don’t see them so much in direct competition.

Professor Kerry Brown

Great, I don’t know Christine or Evan, do you have any view on this, and Christine?

Professor Christine Loh

Yeah, maybe I can come in. I think that, you know, the so-called China story, how China is repositioning itself in a more politically contested world. And to be honest, I often – you know, we read everything about where situations are, and we’re talking about possibly decoupling of economies and so on, we don’t know to what extent. There’s a lot of sanctions around at the moment.

I think we all can agree that the sensitivity of the dual political shift, the anti-China feeling, it’s there, and whether it will get worse or maybe slightly better, in certain circumstances, what will international business be lobbying their governments to do, and not to do, we can’t always predict. What we do see in China, is that the government is very active, and we are also saying – and to an extent, they’re very aware of what these risks are, and the steps that they are taking today, to strengthen their own economies, because they need to defend their economies and so on.

And if you’re sitting in Hong Kong, I believe the HKMA, the monetary authority, have already said that they are thinking about, you know, the dollar peg, they are thinking about the security of Hong Kong’s very large foreign exchange reserves, because of the overall political environment. Now it is beyond my pay grade to go deeper into those issues, but when we watch what are some of the things that might happen, how China will continue to evolve her policies, it is not clear actually how people are willing to invest or not invest in China. But if they’re willing to invest in China, why are they not willing to invest in Hong Kong? And we’re not yet seeing the, kind of, dramatic drop in foreign investments on mainland China itself. So, for me, this issue is murky and hard to predict. So it’s easier for us to actually say that in Hong Kong, what are some of the positive improvements that we can make to the Hong Kong system, that will strengthen Hong Kong’s own ability to do better at various things.

Professor Kerry Brown

Great, thank you.

Ben Bland

Can I just make one further point quickly, sorry Kerry, to jump in.

Professor Kerry Brown

Yeah, no problem. Yeah.

Ben Bland

But I think we need to also reflect on how much, kind of, Hong Kong’s economic relationship with China has changed in the last, you know, 25 years, and just mostly that’s because China’s changed, right? So the time of handover, I think Hong Kong’s economy was, the GDP was around one fifth of that of China, and today, I think it’s less than 3%, basically a similar size to the neighbouring cities of Guangzhou and Xinjiang. So, it just had a massive transformation, not because Hong Kong has shrunk, but because largely the Chinese economy has grown so much.

So, I think, and on this one hand, you’ve had that dynamic of the economy becoming much less important, in one sense. On the other hand, Hong Kong is now a kind of really big political risk, if you’re sitting in Beijing in 1997, it probably wasn’t as much of a concern. So now you have a less important economy to the whole kind of mothership, but much more political risk. So I think those dynamics have changed quite a lot, just because China’s changed. And so I think we need to understand that when we think about Hong Kong’s economic future, it’s really not this driving force behind the Chinese economy. It’s really, kind of, the other way around now, but that wasn’t so much the case in 1997, which perhaps is why I think the Chinese Government and Communist Party were so hands off around the handover, because there was a sense of, if you meddle too much in Hong Kong, you could, kind of, bring the whole economy down, in a sense.

But that’s not the case anymore, and I think whether we like it or not, the clampdown has succeeded from Beijing’s perspective, in that sense, in that Christine’s right, there hasn’t been a mass exodus of money or foreign bankers or anything like that, and where they have been leaving, the bankers anyway, it’s probably as much because they don’t like the COVID restrictions, as the lack of democracy and freedoms.

Professor Kerry Brown

Thanks, Ben. The next question is from Dina Mufti, about “What’s going to happen to the Hong Kong dollar? Will China enforce the use of the Hong Kong dollar?” Does anyone want to address that issue, I don’t know if Evan or Ben, do you have any view of whether the Hong Kong dollar will not be, sort of, live in the future? I suspect maybe it will be, but I don’t know, what do you think, Evan?

Evan Fowler

I mean, I have to say this is an area where I’m not really, sort of, competent to comment, so I won’t comment on that. But what I will do is just use this opportunity to perhaps just touch on some of the broader issues that Ben and Christine outlined in answering the last question.

I mean, I think, you know, the – I was speaking, just by coincidence, you know, quite recently, to some Hong Kongers who had moved over to the UK, and, you know, we’ve also got to, sort of, understand that the economy has changed, and of course, as everyone is saying at the moment, data is the new oil. Hong Kong, up until quite recently, had a very, very fast-growing sector of mostly, sort of, SMEs that were offering, you know, to, sort of, servers to – in Hong Kong to, sort of, host data. That industry is basically collapsing. Why? Because people now, when you sort of say, “Would you like to keep your data in Hong Kong?” Look, this is not just in the West, but generally all over the world, suddenly red flags appear. That is going to have an impact on Hong Kong.

You know, Hong Kong economy is not just whether bankers and investors have confidence in Hong Kong. I’m not saying that it is right for Hong Kong to be red flagged, but, you know, the reality it is, and I think again, what is concerning, you know, from the point of view of the Hong Kong Government, and also from Beijing, is that there doesn’t really seem to be any real attempt to address what are, you know, actual concerns that people have. Other than to basically just say, “You shouldn’t have these concerns.” And, you know, on the point of political risk, it’s absolutely right that Beijing, you know, has come to, sort of, view Hong Kong as being a political risk, and, you know, the NSL was a way of dealing with that risk. But the risk was also something that was very much self-generated from Beijing.

I remember one of the most inciteful conversations I had actually before leaving in Hong Kong – before leaving Hong Kong, and, you know, this was about in 2016/2017, I was at Chinese UNE, and I won’t say who it was, but I was having a conversation with, you know, a friend, who’s also, you know, quite a well-known academic, and, you know, this person, sort of, just – he said, “Well, you know, the big thing, sort of, behind a lot of the political unrest and, you know, the feelings that people were having, it wasn’t – again, it wasn’t because suddenly they believed in democracy, and they wanted to overthrow the Chinese system. You know, what they were looking at was they were, sort of, saying, “We’re a little bit fed up of being told how to be Chinese.”” And this friend of mind came over and said, you know, “On the point about waving colonial flags, no-one wants the British back really,” but the point is, you know, the British, they didn’t tell us, they didn’t interfere in things, which I think are very central to people.

Remember, in 2008, you know, many, many Hong Kong people were delighted that Hong Kong co-hosted the Olympic Games. I mean, people were very proud of being Chinese. One of the things you often heard was that, you know, when the Hong Kong team, you know, or Hong Kong athlete was playing a Chinese athlete, you know, people were, sort of, you know, torn between who should I support?

I don’t think Hong Kong really is a rebellious little boy. So the question that, you know, I think Beijing and the Hong Kong Government should be asking, and to be fair, I think a lot of the more moderate, you know, pan-democratic or pro-democracy voices in Hong Kong have been pushing and that is to just say, you know, look at some of these problems a little bit more honestly. You know, where there are problems you’ve got to address them. And I think the failure to do that, and also we’re seeing this at the moment with Hong Kong’s COVID policy as well, you know, I think people are starting to now look at Hong Kong, they’re starting to now look at the Hong Kong elite and saying, “We’re not so sure whether we have the trust in these people, and in these institutions, to govern well, and to even accept the reality that many of us are seeing. We’re unfortunately – we feel that Hong Kong is shifting from, let’s say, being its own reality, the world of voices, to shifting into, increasingly into the reality and ultimately with that, the economy of China. And we’re seeing China, you know, not only seeking to protect its economy from, you know, potential western sanctions, but also, I mean, I think, you know, create an economy, which isn’t reliant on the West.”

And I think the great fear is Hong Kong, which used to, for so long be the bridge, is going to essentially operate, perhaps very successfully, perhaps there will still be a lot of opportunities for, you know, for people to profit, but it will increasingly become an economy tied to China. And whether that’s in Hong Kong’s long-term interest or not, is something to think about.

Professor Kerry Brown

Great, thank you, Evan. I don’t know, Ben, just on the narrower question of the Hong Kong dollar, as a previous, sort of, Financial Times Journalist, do you have any view on that, or is it not something we should be worrying about?

Ben Bland

When I first moved to Hong Kong for the FT in, I think 2014, or 15, people were still talking a lot about the internationalisation of the renminbi, but ultimately, I think it fell victim to the desire to have greater central control, and the fear of losing control. And yeah, the face of the Hong Kong dollar is going to be tied to what China does with its own capital account and its own currency. It’s not a, sort of, question of what’s best for Hong Kong, it’s just a reflection of what happens in China. And if eventually, you know, the renminbi [inaudible – 48:20], the renminbi becomes, sort of, of globalised, in the sense, then I don’t think there’d be too much point in having a Hong Kong dollar that’s tied to other currencies. That wouldn’t really make any sense anymore. If it was, there wouldn’t be much money to be made. But ultimately, I think it’s a question for, sort of, Beijing’s, you know, international economic strategy and how much control it’s willing to lose to the international markets, not really one for its Hong Kong policy. And I think that speaks to my earlier point about Hong Kong being a much smaller part of the Chinese economy now than it was before.

Professor Christine Loh

Well, I think I just want to add that the fact that Hong Kong has continued to progress, and also that the Chinese economy has grown by leaps and bounds, beyond perhaps what any of us could have estimated, going back let’s say the last 30 years, it’s a good thing. I mean, it’s not a problem, in terms of Hong Kong being a smaller part of a much bigger China.

Secondly, as China, of course, has its own thinking too, about how Hong Kong can do better. So, the idea of investing in innovation and technology, of integration with Tiangong, which is, you know, the so-called silicon valley of China, I mean, these are Chinese plans, and we don’t need to debate about whether they’re right or not. But theses things are also happening.

As regards to Hong Kong dollar, it’s kind of the first time, I think, at this moment in time, where the world is not just the dollar peg, it’s how people look at, or how people look at their assets, and whether they want to continue to invest their asset and their money, in even Western societies because of what’s happened and brought up by a lot of sanctions and so on. And then, now we’re talking about going into a period of inflation, stagflation, recession. I mean, this is all going to have an impact on all of us, and I think Evan’s comments has to do with the quality of leadership in Hong Kong, that’s a separate issue, right?

The quality of leadership, I have to say that how can we help them in a way? I mean, from my point of view, I want to see the Hong Kong Government do well. It’s been difficult for them to be able to communicate successfully with Hong Kong people about all kinds of policies, never mind about the national security law.

How can they communicate well, also with their mainland counterparts, so that perhaps we can have those more successful and more sensitive discussion about Hong Kong’s own identity and sensitivity? And how they can have a place within a much bigger China. And then, of course, for Hong Kong to be able to communicate with the world, I think speaking – you know, one of the complaints from Hong Kong people, is that our officials in Hong Kong are sounding more like mainland officials. You know, and this is a criticism because is this another sign of Hong Kong people losing their own sense of self and autonomy? Well, actually it’s just really difficult to have three-way discussion in Cantonese with local people, Putonghua, that mainland will understand what you’re saying, and then to communicate it in a more relaxed, un-awkward way in English. You know, so it’s really hard for Hong Kong, and I want Hong Kong to be able to develop that competence to be able to do that. Otherwise, it will be extremely hard, as Evan said, to be the bridge between different parts of the world.

Professor Kerry Brown

Great, well, I think those comments come to the final question I’ll ask today, which is from Melanie Hughes, which is about the education in Hong Kong schools, and universities. And is the curriculum now completely Chinese, and what might be the effect? Now, I know there have been a lot of discussions in the city about the use of Cantonese, and I suppose these relate to this big question that you’ve all alluded to, in different ways, of identity. What is it to be Hong Kongese in the 21st Century? I think either Ben or Evan referred to some historic issues. I suppose, broadly, you could say that the British administration was kind of indifferent, I mean, it was always a British administration. It didn’t really have a view on, you know, kind of, people in Hong Kong becoming British, it just felt that they were part of a colony and they had that kind of separation. So it was, kind of, indifferent. I’m not saying that as a negative or a positive thing, it’s just indifferent.

Whereas of course, now you have a government in Beijing, where identity is so important and is crucial to what it does in Xinjiang to what it does really everywhere. So, for Hong Kongese, you know, how do they maintain that sense of being part of this, but different? Either through the education system, you know, is this possible, and how could it be sustainable, in what I assume, in the next 25 years, will be even more intense pressure to you know, be Hong Kongese, with Chinese characteristics, which may well end up not really being Hong Kongese at all? So, maybe if I can, sort of, start from reverse order of when I first, sort of, started, so maybe Christine, and then I’ll ask Evan and Ben to, sort of, fold up. Thanks very much.

Professor Christine Loh

Okay, well, I think one of the things, Hong Kong people don’t feel very good about themselves, at the moment, is that, you know, they think they’ve lost their mojo. And I don’t actually think that that is true, and part of the thing about understanding that we still have our mojo, I think very practically is to be able to see for ourselves that we can solve problems. And problems can be smaller problems, you know, can we do Hong Kong projects across the board, in ways that are positive, that could even be world leading, in some sense? So I’m not going to go into examples, but I do know some, for example, if we’re talking about the environment. So, how do we promote those, how do we teach those?

So it’s not all about are we patriotic? I mean, if the line about patriotism is well, we don’t go for regime change, you know, we don’t talk about upsetting the applecart in the political regime in China. Well, that’s one red line, in terms of what we can do in Hong Kong, with our own politics, with our own selection of the policies and projects we want to pursue. And to pursue them at a very high level, and to do the, kind of, research that is Hong Kong-based research that is perhaps Southern Chinese because we have a strong route in Cantonese culture, of Guangdong culture. I don’t see why that’s not possible, and why we can’t keep Cantonese as a very vibrant language, in terms of China as a whole. So I’m much more positive about what we can do, but there is a red line. The red line from China is whether people are willing to accept that, which is that we accept China and its regime and we look at day-to-day administration and autonomy, in terms of Hong Kong as an entity.

Professor Kerry Brown

Thank you, Christine, thanks very much. Evan, what’s your view on this big question?

Evan Fowler

Well, I’m actually extremely worried to just give a little bit of anecdotal evidence. You know, my goddaughter, who’s still in Hong Kong, was put through a class on the opium war, and what was quite clear was the class wasn’t dealing with the opium war as a historic thing, it was basically teaching hate. And the class included talking about the best gift, you know, in life, is to be born Chinese, and, you know, how much we hate the French, and how much we hate the English, or the British.

Her father is British, and she’s nine-years-old. Now, that shouldn’t be happening. You know, I agree with Christine, I think it’s easy to, sort of, underestimate Hong Kong people. I will always have faith in Hong Kong people, in their ingenuity, and their ability to find ways to, kind of, you know, keep alive their identity, but then, at the same time, I think we have to accept that the environment in Hong Kong itself has changed very fundamentally. And I think it will be increasingly difficult for people to, you know, to – I mean, identities are changing, they’re evolving constantly. The identity of those who have left Hong Kong, who are amongst the Hong Kong diaspora, is going to evolve in one way, people who remain in Hong Kong, even if they try and keep their identity, it will evolve in another way. There’s nothing wrong with that. But my concern is really this attempt to shape that identity in a way ,which is driven, you know, frankly – Christine was talking about anti-China feeling in the West. I mean, looking at it, I would say you’re seeing it both ways, and I think we mustn’t forget about that, you know. And there’s some really, you know, quite appalling things happening, I think, in China, and in Hong Kong, in social groups and things, you know, that is really painting a very hostile picture.

So, sorry, I think it’s going to be very difficult. But again, I guess, coming back to the point, identities change. What it means to be a Hong Konger will change, and, you know, I’m aware that, you know, my family members, you know, when I think about my nephews and nieces, in Hong Kong, I remember I had a dream. Very last story, I had a dream, actually it was a nightmare, recurring nightmare, of – I have a nephew I’m very, very fond of, and I imagined in my dream, you know, how difficult it would be to communicate potentially when he’s a bit older, simply because the way he understands the world, the way he frames the world, the way he frames even what happened and understands what happened in 2019, and the way Hong Kong has changed, may be fundamentally different to mine. And I woke up and I turned round to my wife and I said, “I had this awful dream.” And she turned round and she said, “You know, sadly, we’re probably going to have to just accept that that’s the way things are going.” So I think what it means to be a Hong Konger will be fundamentally different in Hong Kong than it maybe outside of Hong Kong.

Professor Kerry Brown

Thank you very much, and final words to Ben.

Ben Bland

Thanks. It’s really interesting that there’s a question about education, ‘cause if you think back a decade ago, to those images of a young – very young spotty teenager, called Joshua Wong, who first, kind of, emerged into the Hong Kong public imagination, and the global public imagination, leading a protest movement against an attempt by the Hong Kong Government, to bring in a, kind of, moral and national education, I think it was called – it was basically designed to show the Chinese Government and Chinese history in a more favourable light. And it was that the kind of triggered this protest movement, which I think sewed the seeds for the later occupier, umbrella revolution, in 2014, which then, in its own way, kind of, shared the dynamics of what happened in 2019. So, actually, education, in many ways, has been at the heart of what’s happened, basically a battle over what people should learn, and that comes down to this question of identity. Because I think, you know, the Chinese Government and Hong Kong Government, and, you know, the Hong Kong students and school pupils, who are at the heart of much of this, can understand that yeah, education wasn’t just about, kind of, learning a version of history and preparing for your career in banking or whatever.

This was a fundamental question of like who you are as a person and a people. And I think the sense that that was being challenged was what drove, kind of, the violent ructions of the last few years. ‘Cause I think for all of us, if our sense of self is challenged, it makes us very uncomfortable, it feels like a very visceral threat. And so people are willing to react in a very strong way, but I guess, as Christine was saying earlier, obviously people in the Chinese Government at the highest level, felt a kind of visceral threat from Hong Kong. And from the sorts of ways young Hong Kongers were expressing who they wanted to be.

So I think this just gets back to these fundamental tensions that were there, and that was the legacy of British colonial history. And I think unfortunately, the forces were always going to tear apart a people, but as Evan said, people in– and as Christine said, people in Hong Kong will, kind of, reinvent themselves because they have no choice. People who have left Hong Kong and who will leave, will reinvent themselves, ‘cause that’s, kind of, in the fundamental nature of humanity, but yeah, I think it does what has happened, speaks to this greater challenge that’s going to come from the world. Yeah, ass there is probably going to be more intensified competition between China and the West, I think these sorts of challenges aren’t going to be just questions for Hong Kongers. But people in South East Asia, people in the UK, and people around the rest of the world.

Professor Kerry Brown

Great. Well, thank you very much to our three panellists. To Christine Loh, Evan Fowler, and Ben Bland, thanks for the programme, the Asia-Pacific Programme at Chatham House, for hosting this very timely and topical event. We hope we can continue to engage both on this issue, but also on the work of the programme, and thank you for listening in today.

This recording, I believe, will also be available on the Chatham House website, for those who wish to listen to it again later. Thank you for your questions, and your participation, and hope to see you soon. Thank you.