“The former Canadian prime minister Brian Mulroney was kicked out of government when his approval ratings were as I recall slightly lower than the prevailing level of interest so he wasn’t terribly popular when he left office and he tells himself a story about somebody going up to the front gate of his former official residence in Sussex Drive in Ottawa the day or two after he’d been kicked out. And someone goes up to the policeman on duty and says ‘Can i speak to Mr Mulroney please? And the policeman says ‘Sorry, Mr Mulroney doesn’t live here anymore. The next day the same guy turns up and asks to see Mr Mulroney. The policeman again says sorry Mr Mulroney doesn’t live here anymore. The guy goes a third time and the policeman says, ‘Look, I’m getting fed up with this – I’ve told you already are Mr Mulroney doesn’t live here any more.’
And the man says I know, he says, but I just love to hear it.
Coming here this afternoon we passed government house and I hoped that there weren’t people still queuing up at the gate to hear, to their great relief, I wasn’t living there. Anyway, it’s always nice to be back and to see the evidence in the ubiquity of the media that Hong Kong is still a free city. So thank you all for inviting me today and thank you for coming in such prodigious numbers.
I guess at least until June this year the two most important developments in my life were, first of all, the fall of the Berlin wall which ended the Soviet Union’s European empire and seemed to end as well the threat from global communism; and secondly the second event which I think has been of spectacular importance is China joining the global economy, the most important example of globalisation that there has been, setting China on course to be what it has been for 18 out of the last 20 centuries: the largest economy in the world. Those events were part of the script written by the United States after the war establishing a world order based on rules, based on the opening up of markets and free trade, based on security guarantees from the world’s biggest military power. All things which brought us security in Europe through Nato, which brought certainly after the Korean war security in East Asia despite the fact that there was never the same sort of historic reconciliation between China and Japan that there was in Europe between France and Germany, which brought us in the 50 years between the middle of the last century and its end a spectacular increase in world trade so that the trade in manufactured goods went up in 50 years from 8% of global GDP to 20% of GDP. And some of the results of that we saw in the hundreds of millions of people in China and elsewhere in Asia who were lifted out of poverty; the development of the middle class across Asia.
People used to talk about the American imperium. I’ve always thought it was more accurate to talk about the American emporium, the extent to which the opening up of America’s market and the markets in Europe provided exporting opportunities for what we used to call Third World countries. When I was Britain’s development minister in the 1980s that was a term that was tossed about and we used to look at countries that were best known for the manufacture of plastic toys, for manufacture of cheap polyester sheets and shirts, for the manufacture of Soviet era tractors; and which tried to gang up in cartels of commodity producers against the richer countries of the world to establish what they called a new international economic order. Well we got a new international economic order. We got it because those countries, which we now call emerging markets, because those countries learned how to sell high quality products to developed economies at prices which undercut what the countries could make them for themselves. It’s an extraordinary success story. and the figures queue up for gee whizz exclamations. China which for example from the mid nineties in a 15 year period increased its exports to the United States by 1,600%. Who suffered from that? Well most of us of course gained. We gained because inflation was licked with lower prices for goods. we gained because in developed countries people got those goods at lower prices. consumers gained everywhere. we gained in emerging markets because people were being employed seeing investments seeing the reward of those investments and we gained in both developed countries and emerging markets because we became more competitive.
in my view it would be dishonest, dishonourable and reckless of somebody like me to pretend that the case for democracy could be mixed up with an argument about the independence of Hong Kong
Some people undoubtedly lost. In America about one sixth of those employed in making things lost their jobs. So was the right answer to that to say that we should go back to protect our markets and stop trading with one another? Forget about it. Forty percent, for example, of the manufacturers from Mexico to the United States involve a large number of things that which made in America. Half of America’s exports go to countries with which it has free trade agreements, and what’s true of America in the world is also true of Europe in the world. But unfortunately those who didn’t do well in developed countries out of globalisation have been encouraged to point the blame for that onto free trade and onto the opening up of markets. The fact that is untrue doesn’t seem to matter very much. If you want to know really why in the united states some people have done so badly in the last few years its because America spends one sixth of the OED average on retraining workers who have lost their jobs. In the United Kingdom, where outside London and the south east since the financial crash in 2008/2009, people’s income has gone down. If you want to find ways of dealing with that there again in the field of redistributive tax and spend policies which look after people who have been casualties because of economic change.
But we’ve just had two elections as you know which seem to suggest that the answer to our problems is greater nationalisation, protectionism, and thinking primarily of ourselves, and pulling up the draw bridge to the rest of the world. I hope that Mr Trump as president proves different from Mr Trump the candidate, otherwise we’re all in real trouble. I hope that in Britain what Brexit means – and we’re told with a spectacular tautology that Brexit means Brexit, lunch means lunch, breakfast means breakfast… it can be croissant and coffee or the full English – I very much hope in Britain that the British government will reach the early conclusion that instead of negotiating our departure from the European Union with a cliff in two years time, we negotiate some sort of transitional arrangement which enables our industries, our exporters to adjust over time to the loss of a market which takes at the moment 45% of our exports.
So I suppose there are ways we can get through Trump and Brexit but it’s not going to be very easy and it’s a particular worry when one looks at the economic situation with emerging markets, not least here in Asia. It does look now as though Mr Trump is preparing to abandon the transpacific partnership that mostly puts the onus on other Asian countries to make a real success, including China of course, of the regional comprehensive economic partnership – not as deep or important as TPP but still a useful way forward.
The one thing I hope we can avoid is a tit-for-tat trade war between the United States and China. The one thing I hope we can avoid is a drift into what some people have called the thucydides trap in which there’s a stand-off between the United States and China. I can understand people taking exception to some of the mercantilist policies in China. Parenthetically I just note in passing that they might also take exception to the mercantilist policies of Germany.
Taking an oath is a serious business… taking oaths isn’t something of a lark
I hope that despite, that despite the real question marks which are raised about political repression in China, we can shape a world in which we can accommodate China’s legitimate interests with those of the rest of us. Because one thing that’s for sure is that China doing well is one hell of a lot more important to us than China not doing well. Whether or not that is the view that Mr Trump will come to hold, I’m not sure.
In Europe we’re going to have to do more for ourselves in terms of security and I hope we’ll be able to persuade Mr Trump that there is a difference between Vladimir Putin and Florence Nightingale.
Just to say a couple of other things. The first is about the importance of universities – not least universities in Hong Kong – helping to shape a return to the liberal order that has been so extraordinarily successful over the last 50 or 60 years. I am Chancellor of Oxford University and we’re very pleased that in the latest rankings we came first in the world. I think one reason why we became first in the world is we regard ourselves as a university for the world. We have nearly 1,000 students from mainland China. We have 140-150 from Hong Kong in addition. One hundred and eighty of our professors and senior researchers are from the mainland of China, 15 or so of them from Hong Kong, and I think that’s nothing but a good thing and I hope that we’ll be able to attract even more students from around the world in the next few years. But first we have to persuade our government that there’s a difference between a student and an immigrant.
The second thing I’d like to say is that obviously I follow, albeit from a distance, what’s been happening in Hong Kong. And since I suspect I might get a question on this, let me say a word about it here and now, although it may have much less impact on your lives every one of those in Hong Kong than what Mr Trump gets up to. You know very well that I believe passionately in the Rule of Law and the freedoms which it brings with it. And I have always believed that Hong Kong had thrived and prospered partly because of the Rule of Law, partly because of the pluralism of Hong Kong’s society, and that sooner or later those freedoms should include the freedom to choose who governs Hong Kong.
I think 20 years after the departure of the colonial aggressor it’s surprising that democratic development hasn’t happened rather more rapidly. It was supposed to take place at a steady rate. The steady rate seems to be pretty slow. And I will always support sensible efforts to strengthen the democratic movement in Hong Kong. Like many others I watched with huge admiration the on the whole peaceful and mature campaign for democracy in Hong Kong a couple of years ago. So I am totally committed to that and I’ve always seen that commitment in the context of my passionate belief in the importance of the Sino-British Joint Declaration. The Sino-British Joint Declaration. Under the Joint Declaration the British had obligations to the people of Hong Kong before ’97. And we had to tell China how we were meeting those obligations. Under the treaty, the Joint Declaration, China has obligations to the people of Hong Kong for 50 years after 1997, and Britain has an interest in how those undertakings are addressed, as does the rest of the international community.
The situation in Britain, which seems to me to be a perfectly reasonable one, is if you won’t take an oath you can’t join the club
I used to know that Joint Declaration off by heart. Paragraph 3, sub section 1 talks about the territorial integrity of China and national unity including the SAR and the rest of the country, so in my view it would be dishonest, dishonourable and reckless of somebody like me to pretend that the case for democracy could be mixed up with an argument about the independence of Hong Kong – something which is not going to happen, something which dilutes support for democracy and something which has led to all sorts of antics which should not take place in a mature society aiming to be a full democracy. I think two years ago many brave young people in Hong Kong established moral high ground about democracy in governance and I think it would be a tragedy if that high ground was lost because of the antics about so-called independence for Hong Kong.
Maybe it would be better if people in the north left it for Hong Kong courts to sort out the consequences of that which they will, I am sure. But inevitably it perhaps motivated one or two of the people who wrong-headedly pursued this argument. Inevitably there has been a backlash and I would guess that backlash probably reflects sentiments in the mainland which will go well beyond the ranks of the Chinese Communist Party.
I say all that so there can be no doubt where, as strong a proponent of democracy as you could find, places himself in this debate.
But let me add something, just so as to spare journalists asking the question – and I hope setting things out in this detail will mean that it doesn’t become the subject of every interview I do over the next four or five days… Taking an oath is a serious business. I have taken oaths on several occasions. I took an oath when I came to Hong Kong. I take an oath as a member of parliament. I took an oath the other day as a member of the House of Lords. I supported two people who used to work in Hong Kong – Peter Ricketts and Edward Llewellyn – when they were taking oaths in the House of Lords. I have taken an oath as a privy councillor – and it’s a serious business. In London, I take an oath with my hand on the Bible. Taking oaths isn’t something of a lark. Moreover, the situation in Britain, which seems to me to be a perfectly reasonable one, is if you won’t take an oath you can’t join the club. We have a political party in Northern Ireland – Sinn Fein – made up of republicans who won’t swear an oath of allegiance to the Queen. So they can’t take their place in parliament. Simple as that. And I would guess that there are legislatures all over the world which have similar requirements.
I think it is mistaken to confuse the argument about the nature of Hong Kong’s really special citizenship – the way in which people know in this community, the relationship between freedom of speech, freedom of the media, due process, independence of the judiciary, the way people know the relationship between those things and their own prosperity and well being… I think it’s a mistake to confuse that with some headline-grabbing remarks about independence.
I had great admiration and still have great admiration for those who campaign for democracy, but not those whose campaign dilutes support for democracy and makes a mockery of a serious political argument. Sorry to sound so headmasterly, but I just thought you might ask the question so why not get my retaliation in first? Thank you very much indeed.”