Laurence Brahm: Hong Kong remains unique and continues to offer a future
Wednesday,Aug 21, 2019
By Laurence Brahm, a senior international research fellow at CCG
Recent unprecedented waves of protests in Hong Kong raise a key question: Why? Are these Hong Kong protests about a tabled extradition bill, people's rights, economics or foreign intervention?
The proposed extradition bill has been suspended due to protest opposition. However, is this enough to spark riots and violence? Is intentional sabotage of Hong Kong's, and in turn China's, financial system at the source?
Hong Kong Stock Exchange Chairman Li Xiaojia has observed and commented, "Voices against one nation belong to discordant noise and not the mainstream view." However he added, "You should allow Hong Kong to deal with these discordant noises in its own way."
The outcome of earlier protests at the airport resulted in re-routing flights to Shenzhen. Is this good for the long-term prosperity of Hong Kong? Anxiety and anticipation can drive financial decisions. Money is shifting elsewhere out from Hong Kong. But can anywhere really replace Hong Kong?
"Hong Kong people at the same time should be confident that Chinese mainland mainstream has never had the intention to ruin the two-systems, because to maintain the two systems is in the basic interest of China's development," Li also observed."
Hong Kong's position is unique. There is no other city like it in China or Southeast Asia. Hong Kong is the third-busiest airport in the world. It is also one of the world's most efficient, handling over 75 million people each year and serving as a major transport hub for global shipping. The protestors have interrupted that. Will it serve their long-term interest as Hong Kongers or serve the interest of certain American political think tanks and politicians that are funding them? How much is Hong Kong's recent social turbulence been a purely Hong Kong issue, or an extension of the trade war pressures being overheated?
Hong Kong has served as the financing center for China's massive Belt and Road program. This could all evaporate under continued protests shifting the financing function to other cities in the Chinese mainland and even other Asian countries as well. The Belt and Road is about infrastructure investment and shared economic development. The financing has and will continue be driven from Hong Kong. Key currency swap agreements between China and Belt and Road partner countries for the use of yuan currency in settlement and exchange are positioning the yuan to become a second reserve currency, at least for the region. Hong Kong's role as the key financing center for the Belt and Road remains critical.
Hong Kong is positioned to lead as the financing center for enormous AI development in the region, as well offering enormous potential opportunity for youth. The entire vision of the Greater Bay region between Shenzhen and Hong Kong becoming an AI center will depend on Hong Kong for financing. The future opportunities for technology development, program design, AI and the financing that is so essential to all of it, lies in Hong Kong. With the Greater Bay area expanding the potential of China's technology, the prosperity of Hong Kong, Shenzhen and the coastal cities are integrated. The symbiosis of economics and opportunity should out-shadow the doubts that many have over Hong Kong's future.
One of the reasons that Hong Kong has always stood out as the financing center of Asia and the third largest financing center in the world, is its incredible resilience and ability to bounce back from whatever global or regional turbulence over time. That is what makes Hong Kong unique and gives the world confidence in Hong Kong and its people.
So the question is, who is benefitting from the protests, Hong Kong business, finance, technology, youth? Or the Washington D.C. political right-wing, anti-China establishment that does not want to see China's economic rise, which is integrated with Hong Kong and its own future? For them, Hong Kong and its youth are expendable.
Laurence Brahm, a senior international research fellow at Center for China and Globalization(CCG) and founding director of the Himalayan Consensus, an author of Zhu Rongji and the Transformation of Modern China.
From China Daily，2019-08-21
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