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Hong Kong: The Forefront of the US-China Trade War

By September 25, 2019 No Comments

by Conn Lee, Guest Writer

Hong Kong’s summer of discontent has already lasted thirteen consecutive weeks. Protests were triggered in early June by the widely repudiated Extradition Bill, which would have allowed criminal suspects in Hong Kong to be tried in China. What began in peaceful demonstrations has escalated into violence and urban guerrillas over the past months.

The bill was finally withdrawn last Wednesday, but doing so fulfills only one of the five demands laid out by the people, including an investigation into police brutality, amnesty of all arrested protesters, retracting the characterization of the protests as “riots” and the implementation of universal suffrage in the Chief Executive and Legislative Council elections. Despite the regional government’s belated attempt to quell the havoc, the unrest, which has now evolved into a greater movement calling for democracy and autonomy, shows no sign of stopping. 

The withdrawal does not guarantee a victory for Hongkongers, as the once safest city in Asia is turning into a terrifying police state. Arbitrary attacks on civilians, mass arrests, alleged collusion with gangsters, sexual assault, torturing and unrestricted use of lethal weapons have spurred public fury. 

Amnesty International Hong Kong has issued reports on police brutality while calling for an investigation into unrestrained policing. What’s even more worrying, there is evidence showing the local law enforcement has been infiltrated by Chinese paramilitary personnel, fueling fears over the penetration of the mainland authority in local affairs. 

The protesters are also calling for democracy. Although guaranteed by the Basic Law, the region’s constitution, popular elections have never been implemented due to disapproval from Beijing since the transfer of sovereignty from the United Kingdom to China in 1997. In the eyes of Hongkongers, the lack of democracy makes the territory extremely vulnerable under Chinese dictatorship as they see their civil liberties and autonomy being gradually chipped away by Beijing-anointed ruling elites. 

After breaking the standstill by having the bill shelved, Hong Kong still shudders in the turbulence of international politics while tensions arise amid the trade war between the United States and China

The smoke spiraling up from the streets in Hong Kong overshadows the ongoing US-China trade negotiations. It is fair to say that the city’s struggle for freedom has been positioned in the wrestle of the two superpowers. Hong Kong’s situation has become more precarious than ever.

The situation in Hong Kong has even managed to overcome the rift between Republicans and Democrats: there is a bipartisan consensus that Hong Kong will be a top priority for the US when Congress resumes after a recess next week, and diametrically opposed US leaders have expressed support for the city’s pro-democracy movement. The Hong Kong Human Rights and Democracy Act, proposed by Republican Senator Marco Rubio and Democratic Senator Ben Cardin, will allow the US to impose sanctions on Chinese and Hong Kong officials who took part in the brutal suppression of the pro-democracy movement. 

House Speaker Nancy Pelosi also expressed concerns over China’s actions in Hong Kong in a statement and hoped to swiftly advance the bipartisan act “to reaffirm the U.S. commitment to democracy, human rights and the rule of law in the face of Beijing’s crackdown.”

In contrast, Trump is taking a more “hands-off” approach towards the issue. “If it’s another Tiananmen Square, it’s – I think it’s a very hard thing to do if there’s violence,” he said on 18th August, after calling protests “riots”, adopting the Chinese government’s rhetoric. He also suggested a more “humane” resolution for Hong Kong before reaching a trade deal with China. 

Hong Kong appears to be a bargaining chip amid the trade negotiations. In fact, the semi-autonomous region has always been at the forefront of the US-China struggle.

By introducing the contentious Extradition Bill and constantly sabotaging Hong Kong’s freedom in the past decades, China has turned the free port into a Trojan Horse that weakens foreign, especially American, interests in the Indo-Pacific. Chinese businesses, be they private- or state-owned, can bypass tariffs, sanctions and export control imposed upon China by exploiting Hong Kong’s special status as a separate customs territory and an independent shipping registry. China has smuggled military equipment and technologies from the West via the free port before. Hong Kong’s membership in a handful of international organizations (ie. WTO) also serves Chinese interests by offering the sovereign state an additional vote.

As well, Hong Kong is key to China’s economic growth in terms of foreign trade and finance; the city is the largest offshore RMB clearing center and the largest source of FDI into China, accounting for 54% of the country’s total. Under the “One Country, Two Systems” arrangement, the city is still a major financial hub for foreign investors who do business with China and wish to settle in a more secure and free environment.

China has been unwilling to fulfill its promise to give Hong Kong the autonomy and democracy it deserves while squeezing the most out of the city’s institutions and advantages. Now China has to deal with the following conundrum: if Chairman Xi decides to roll in the tanks and to put a quick end to the protests, he will simultaneously strangle his own country’s economic prosperity. Another tactic is to rely on local law enforcement and let the movement die out by attrition.

Either way, concessions from China are doomed impossible. Only the US is able to change the game since Hong Kong’s special status is guaranteed by China as well as the countries that recognize the institutional differences between the city and the rest of China, among which the US is the most influential. The US-Hong Kong Policy Act (1992) recognizes the territory as a nonsovereign political entity distinct from China, giving Hong Kong a most-favored-nation status, and indicates support for democratization in Hong Kong.

Undoubtedly, the US has a stake in Hong Kong. The harbor accounts for America’s most profitable bilateral trade-in-goods surplus in 2018, at $31.1 billion, while housing the headquarters of 290 U.S. businesses and one of the largest American Chambers of Commerce in the world since 1841.

Hong Kong will become nothing but another Chinese city once its freedoms perish. The US must not let this happen because Hong Kong is not only an irreplaceable business partner but also a beacon of liberty in Asia, critical in resisting the encroachment of authoritarianism.

Hong Kong shares common economic interests but utterly no common values with China and its defiance towards authoritarian rule show that its people treasure the values to which the rest of the free world adheres.

Losing Hong Kong means a setback for democracy and a huge loss for America’s economic interest in the Indo-pacific. Hong Kong will remain valuable to both of the great powers only if China stops undermining the city’s autonomy; if the city-state were fully subsumed under Chinese rule, the US would be entitled to terminate its differential treatments. For Hong Kong is pivotal to China’s grand strategy in asserting dominance in the world, the US leaders should seize the chance and tackle the Chinese Community Party (CCP) on the Hong Kong issue. 

The US holds all the aces to punish China for its infringements of human rights: for instance, the legislation of the Hong Kong Human Rights and Democracy Act, using the Global Magnitsky Act to sanction Chinese and Hong Kong officials and to expose their overseas properties. 

Some might be skeptical towards US interventionism, but Hong Kong’s recent struggle has exemplified that Chinese hegemony is no alternative to a US-dominated world. Hong Kong and the rest of Asia may only continue to prosper should we strike a balance between both sides of the pacific.

Smaller nations always seem vulnerable on the geopolitical chessboard dominated by superpowers. Whether or not Hong Kong will succeed in preserving its freedoms still remains unsettled, but one thing is clear: the people of Hong Kong have shown courage to speak out against tyranny. The free world must acknowledge that and help defend the city’s already fragile autonomy.

References

https://www.euronews.com/2019/09/05/hong-kong-a-priority-for-us-senate-democrats-leader-says?fbclid=IwAR13yQpf1QHmL-D1B3jc4kg9Eiy9TzYYEPTyPdcuVZesQWdb0kR6ys8VdiY

https://thediplomat.com/2019/05/hong-kong-and-the-us-china-new-cold-war/

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