By Rowan Callick

Patriots of the People’s Republic of China in Hong Kong are being offered $200 cash and free food and drinks to join groups swelling the numbers at the official 20th anniversary celebrations this weekend of the handover of the city from Britain.

This return of Hong Kong is being cast as a hallmark date in the glorious resurrection of China, with President Xi Jinping presiding over the celebrations and the country’s restoration as a great power. His failure to visit previously during his almost five years as leader reflects Beijing’s distaste for the city’s rapid recent politicisation.

The “one country, two systems” formula under which Hong Kong was handed over has come under huge pressure lately — triggering questions about whether the formula can survive the 50 years agreed for it between Deng Xiaoping and Margaret Thatcher.

A shouting match has begun between advocates of each system — those of the Chinese communist party-state, and those of the British-derived cosmopolitan institutions, including common law courts, that Hong Kong had developed between its effective foundation in the 1840s as a free trade port and the handover.

This contest will be dramatised and quantified in the next couple of days as people championing each system join events in Hong Kong to mark — in celebration or in mourning — the handover that took place in pouring rain at midnight on June 30, 1997.

The pressure on Hong Kong has intensified greatly in recent years as the “one country” has changed under Xi. It has become more centralised, with the party becoming more pervasive and the courts — a “knife firmly in the hands of the party”, as Xi has stated — required to be more responsive to party-state requirements. As well, the room for public debate, including on the internet, has been curtailed.

About a third of Hong Kong’s entire police force — almost 10,000 officers — will be deployed to protect Xi and to lock down much of the city during the leader’s three-day visit starting today. The drill with which they rehearsed repelling any threats was titled Hardshield.

Banners, placards and other signs indicating support for the election of Hong Kong’s chief executive or for the victims of the 1989 massacre around Tiananmen Square, or criticising the People’s Republic or its leaders, will be removed by police to prevent the PRC leadership being embarrassed, authorities have explained.

Revellers celebrate the transition 20 years ago.
Revellers celebrate the transition 20 years ago.

At the time of the handover, it was not so clear which way Hong Kong or its relations with its sovereign would develop. China itself had seemed on a trajectory towards reform and opening up, not only economically but also culturally. The mainland appeared to be settling into a pattern of being administered by committee-framed consensus — leading to slow and small but measurable liberalisations — rather than by all-powerful individuals pulling controls tighter.

In Hong Kong, public and corporate phone messages or other announcements are still, as 20 years ago, typically and painfully made in three languages, in no common order of precedence — English representing a cosmopolitan identity, Cantonese a local identity and Mandarin a mainland Chinese identity.

But pressure is increasing on Hong Kong and its inhabitants to choose that mainland path, including through “national” educational curriculums that cast China’s development in a positive light.

Anson Chan, who was the chief secretary of Hong Kong from 1993 to 2001, straddling colonial and Chinese rule, warned during a visit to Australia last year that just as the city had not expected its autonomy to be steadily eroded through “infiltration” as it has during the past 20 years, Australia — with its extensive economic and academic engagement — also faced such risks.

For its part, Beijing tends to view Hong Kong through the prism of its return to centralisation. It is inclined to view those who stress the values of Hong Kong’s culture, and who seek a greater say in how the city of 7.4 million is run, as heading down the same path as the “splittist” elements it most determinedly seeks to crush.

These comprise chiefly Tibetan supporters of the Dalai Lama, those who would graduate Taiwan from de facto to de jure independence, and Uighur backers of greater autonomy or independence for Xinjiang.

The Umbrella Movement seeking more democratic representation that galvanised Hong Kong’s youth three years ago, bringing hundreds of thousands on to the streets, shocked Beijing — which had long primarily relegated Hong Kong in its thinking to an “economic city”, to be kept content by being offered the chance to make more money, for instance through direct links between its stock exchange and that in Shanghai.

Many observers had expected younger Hong Kongers to become more oriented towards mainland China, where larger business opportunities were emerging, as interest in democratic institutions and independent courts faded with any residual British nostalgia of their ageing parents and grandparents.

Instead, the trend has been reversed — with older Hong Kongers likelier to be concerned about upsetting Beijing while a growing proportion of young Hong Kongers are losing interest in engaging with their giant neighbour and sovereign.

The words “localism” and even “independence” — formerly almost unthinkable in the Hong Kong context — are now framing the debate.

Pro-democracy campaigner Joshua Wong wants a referendum.
Pro-democracy campaigner Joshua Wong wants a referendum.

This pattern of dislocation by the educated young from authoritarian neighbours runs parallel with young South Koreans who rarely even think about repressed, mysterious North Korea, and with young Taiwanese who view mainland China as a highly distinct place with which they have little in common.

The world views that informed the Umbrella Movement have not disappeared. The “pro-democratic” political realm in Hong Kong is as highly fractured as ever, seemingly doomed never to emerge as a unified entity, but the attitudes of many young Hong Kongers remain highly disaffected from the establishment there or in Beijing. In polling last year by the University of Hong Kong, 39 per cent of Hong Kongers aged 15 to 24 supported independence, while 26 per cent opposed it.

In polling by the same univer­sity last week, just 3.1 per cent of respondents aged 18 to 29 said they identified as Chinese, with 65 per cent identifying as Hong Kongers and 29 per cent as of mixed identity. Of those in all age groups polled in last week’s survey, more described their identity as “global citizens” rather than “members of the Chinese race” or “Chinese” or “citizens of the PRC”.

At the same time, in China the ancient tian xia view is being revived that “everything and everyone under the heavens and on the earth” should — for their own prosperity not least — defer to the central authority.

This view, for instance, is an impetus of the Belt and Road Initiative, which is driven by geopolitics and economics to build vast infrastructure connecting China with Europe and Africa.

Thus the divide is growing between Beijing and the elements of Hong Kong that most clearly comprise its distinctive system, especially the independence of the judiciary.

Three years ago, China’s parliament published a white paper stressing that “Hong Kong must be governed by Hong Kong people with patriots as the mainstay”, and that its autonomy “is the power to run local affairs as authorised by the central leadership” in Beijing.

It said: “All those who administer Hong Kong, including judges of the courts at different levels and other judicial personnel, have on their shoulders the responsibility of … safeguarding the country’s sovereignty, security and development interests …

“In a word, loving the country is the basic political requirement for Hong Kong’s administrators.”

Hong Kong’s Bar Association replied: “Any erroneous public categorisation of judges and judicial officers as ‘administrators’, or official exhortation for them to carry out any political mission or task will send out the wrong message to the people of Hong Kong.”

This debate persists. Academic advisers to the Chinese government have said that the answer is for China’s parliament, the National People’s Congress, to strengthen its authority through issuing more frequent interpretations of Hong Kong’s constitution.

This strategy was used effectively following elections in Hong Kong late last year when the pan-democrat vote increased, and six youthful members of the Umbrella Movement generation were elected.

Previously viewed as a mere formality, the oath of loyalty required by candidates was used first to ban six “localists” from standing for office because their oaths were perceived as insincere, then — through the issue being referred to the NPC for interpretation — to prevent Young­spiration party winners Baggio Leung, 30, and Yau Wai-ching, 26, from taking their seats because they deliberately misread their oaths, and draped themselves with “Hong Kong is not China” flags.

Antony Dapiran is an Australian lawyer working in Hong Kong whose new book to be published by Penguin next month is titled City of Protest: A Recent History of Dissent in Hong Kong.

He says: “In a city whose population identifies itself — at least vis a vis its sovereign, the PRC — by reference to the rights and freedoms it enjoys which the rest of China’s population does not, protest is an embodiment of that identity, embracing as it does the freedoms of speech, expression and assembly.”

He says the authorities’ tolerance — or not — of such protests serves as a barometer of the health of the unique “one country, two systems” formula.

Carrie Lam, the career administrator who will be installed by Xi this Saturday as the first woman to become Hong Kong’s chief executive, along with her familiar executive team, told The Australian during a visit to Australia 20 months ago: “I remain very optimistic about Hong Kong, once it has made up its mind, it has the determination to succeed.”

She expressed her confidence also in the persistence of “one country, two systems” — stressing its assurance of an independent judiciary, respect for contracts, free information, and the widespread use of English.

Hong Kong remained ideal as a base for companies wishing to enter the Chinese market, she said, in part because of the extent of the experience and advice available, as well as having its own free trade agreement with China.

But she conceded that the fallout from the waves of protests in recent years, including the fractionalisation of the community, had become “a big issue for the government” — one that remains at the top of her agenda as she takes the reins.

Hong Kong MP Claudia Mo, a former TV journalist, tells The Australian that “mainlandisation” is at the heart of the problem. About a million mainland Chinese have settled in Hong Kong since the handover, with tourism and investment domin­ated by Chinese, and as a result Hong Kong is starting to lose to Singapore its status as the great Asian financial hub, becoming instead more of a proxy China play. Mo views the new notion of independence as “almost an escapist concept”.

But for Joshua Wong, the 20-year-old who became the global face of the Umbrella Movement, the protests are just getting started. He blames the British and Chinese for determining Hong Kong’s future between them “without seeking approval from the HK people”, and preventing appeals to the UN for self-determination.

He will be only 51 when the 50-year deal for Hong Kong ends. He says his big-picture plan is to position the city to hold a referendum about its future before that happens.

This weekend, in extreme contrast, Xi’s program is all about how Hong Kong is being brought permanently into China’s embrace, with a tour of the People’s Liberation Army garrison that is hosting the first Chinese aircraft carrier, the Liaoning, and with a visit to the terminus of the new high-speed rail link to China or to the new 42km bridge being completed across the Pearl River Delta to Zhuhai and Macau.

Few doubt China’s capacity to deliver infrastructure, but it’s the development of the software — the people and the legal and financial systems at the heart of Hong Kong’s success as a great city and entrepot — that matters most, and appears most under threat.

Trade deal with free port can open opportunities

Hong Kong is Australia’s leading business base in East Asia, with more than 600 Australian companies operating there.

Talks were launched in Hong Kong last month towards a free-trade agreement.

Trade, Tourism and Investment Minister Steven Ciobo told The Australian that legal, financial, architecture, education, health, construction, transport and other service sectors held high promise for greater participation — while, unlike in other FTAs, tariffs on goods were of little significance since “basically, Hong Kong has none”, being a free port.

Australia’s services exports to Hong Kong have already soared in the past five years by 50 per cent, to $2.4 billion in the past financial year.

Ciobo says a free-trade agreement also may provide Australian firms with better access to Hong Kong’s government procurement market.

The city was Australia’s eighth largest export market in the last financial year, when two-way trade reached $15.3bn.

It is the sixth largest source of investment in Australia, with the accumulated total reaching $85.4bn at the end of 2015, when Australia had invested $50.7bn in Hong Kong.

Ciobo said at the FTA launch: “There’s some very broad and deep capital pools in Hong Kong, which is a trendsetter in the region, demanding high-quality products for its sophisticated and wealthy market.”

The gross domestic product per head of Hong Kongers is 81 per cent that of Australians. More than 100,000 Hong Kongers have migrated and become Australian citizens.

Some of them returned for work as it appeared, in the early years after the handover from the British, that Hong Kong might be little changed.

But now Hong Kongers are heading to Australia in large numbers again, as they did before the 1997 handover, with a 27 per cent rise in visas — of various types — issued in the past two years.

There has also been a surge in applications for Australian citizenship for children over 12 months old — many of them born in Australia to parents anxious about the handover but who had returned to Hong Kong with their families as economic options there picked up.

Article originally appeared in The Australian on 29 June 2017