The Foreign Correspondents' Club Hong Kong

What next for Hong Kong and China’s growing civil society movement?

China will likely promulgate Article 23 in Hong Kong via an interpretation of the Basic Law rather than through the Legislative Council, predicts a veteran China watcher.

Professor Willy Lam at the FCC. Photo: Sarah Graham/FCC

Professor Willy Wo-Lap Lam, adjunct professor at the Chinese University of Hong Kong’s Centre for China Studies and author of a new book, The Fight for China’s Future: Civil Society vs. the Chinese Communist Party, said this was one of the routes Chinese President Xi Jinping may choose to restore order in Hong Kong, where protests have gripped the city since June. He said the Chinese Communist Party saw the unrest as a Black Swan Event – a colour revolution which was a collusion between anti-Beijing forces within China and hostile foreign forces such as the US. President Xi has in the recent past warned his party of the danger of Black Swan Events.

Describing Hong Kong’s Chief Executive, Carrie Lam, as a “lame duck”, Prof Lam also predicted that the CCP was unlikely to undermine her authority further by sacking her, and so would keep her in post while they chose a successor before she stood down.

Guests at the November 5 club lunch were taken through a presentation highlighting China’s growing civil society movement, which has seen army veterans, workers and students protest throughout the country.

Why autocracy with democratic characteristics is key to China’s success

Autocracy alone is not the reason for China’s economic success, according to a political scientist who warned that President Xi Jinping is moving away from the “real” model that helped the country’s massive growth.

Professor Yuen Yuen Ang talked about the “real” China model. Photo: FCC

The “real” China model, according to Professor Yuen Yuen Ang, is autocracy with democratic characteristics, introduced by former leader Deng Xiaoping when he implemented bureaucratic limits on power, competition and accountability. This enabled China to lift millions of people out of poverty as it became more adaptive and flexible, she said.

There are many different opinions when it comes to defining the China model, Prof Ang, Associate Professor of Political Science at the University of Michigan, said. Western mainstream media tends to label it a combination of autocracy – or single party rule – with state ownership and control over the economy. Chinese commentator Zhang Weiwei described the China model as a “super-large population, super-size territory, super-long history, super-rich culture”. Daniel Bell, theorist, believed it to be a meritocracy.

And despite announcing at the 19th Party Congress in 2017 that the world could learn from “the Chinese solution for tackling the problems facing mankind”, the President Xi himself failed to elaborate on what that solution was.

Prof Ang, who has presented her work at academic, global development, and corporate venues around the world, including the World Bank, United Nations, U.K Department of International Development, and the OECD Development Center, believes the political foundation of China’s economic success lies in what she calls “directed improvisation”, the merging of top-down direction and bottom-up improvisations within China’s one-party regime. This creates the right conditions for local officials and governments to implement innovative development, she said.

To that end, Beijing becomes the director, rather than the dictator, she said. While some direction from Central Government was vague and broad – what Prof Ang referred to as “grey” command that is deliberately unclear, therefore permitting experimentation – other commands were clear in either permitting or forbidding an action.

An example, she said, could be seen in data that examines more than 4,000 policies issued by the State Council over the years. Of the “grey” policies, e-commerce and Artificial Intelligence showed the highest amount of ambiguity because, she said, these are new areas in which the government is happy to allow more experimentation. The sector showing the lowest ambiguity when it came to commands from Central Government was Special Economic Zones, “because they’re for foreigners, so when dealing with foreigners it’s important to make the rules clear”, Prof Ang said.

And while she acknowledged that some Western democracies were growing concerned that emerging countries were finding the autocratic element of the China model more appealing than liberal democracy, she added that there were three basic lessons for developing countries to learn from China: Learning does not equal copying; learn from both China’s success and failures; adapt China’s “directed improvisation” to democratic contexts.

She added that she was hopeful that the Chinese version of her book, How China Escaped the Poverty Trap, would help the Chinese public to understand that it was not autocracy that lifted them out of poverty.

“I remain optimistic that there’s still room for debating what are the factors that made China great,” she added.

Watch Yuen Yuen Ang’s talk here.

Beijing’s curbs on political rights in Hong Kong while ensuring rule of law for business is ‘unsustainable’, says top barrister

Beijing’s move to curb Hong Kong’s democratic freedoms while still trying to maintain confidence among businesses is unsustainable, according to Hong Kong’s top barrister.

Philip Dykes, chairman of the Hong Kong Bar Association, gave a talk on the rule of law. Photo: Sarah Graham/FCC

Philip Dykes, chairman of the Hong Kong Bar Association, also said he could not rule out a further interpretation of the Basic Law by the Standing Committee of the National People’s Congress (NPCSC), which he described as “the greatest threat to the rule of law in Hong Kong”.

Speaking at the March 5 club lunch, the newly-elected head of the Bar Association told members that he believed Hong Kong’s judges to be independent and could be relied upon to uphold the rule of law for years to come. But he called on “other decision makers in government – the administrators and the lawmakers” to be “ guided by the rule of law and realise that there are no preferred outcomes of judges and they should not be pressured into making decisions one way or the other”. Dykes was referring to the furore surrounding the long and drawn out legal process involving pro-democracy activists Joshua Wong Chi-fung, Nathan Law Kwun-chung and Alex Chow Yong-kang.

In a Q&A session, Financial Times reporter Ben Bland asked Dykes whether Beijing’s move to heavily circumscribe Hong Kong’s political rights while maintaining confidence among businesses was sustainable, the barrister said: “Ultimately you can’t have one without the other. You can’t hold yourself out as being a system that subscribes to the rule of law and are particularly good at dealing with commercial and arbitration matters but not also accept the burdens that go with that which are dealing with the nitty gritty of political problems, protests, freedom of expression. You will be found out. It’s unsustainable.”

Dykes was also asked about Chinese president Xi Jinping’s move to consolidate his power by indefinitely extending his term as leader, days before the NPCSC is due to vote on it. Dykes said extended terms of power brought about by a change to the constitution “don’t usually end well” but would not be drawn on whether the move would affect Hong Kong’s rule of law.

On the matter of Beijing’s 2016 interpretation of the Basic Law in the case of the oath takers disqualified for not pledging allegiance to China, Dykes said he could not rule out future interventions by the Chinese government, particularly regarding the election eligibility of pro-democracy candidates. “One can easily foresee this bubbling up to become a legal issue,” he said.

Who are the winners and losers in the war for China’s wallet?

The war for China’s wallet is being won through consumerism as industries like manufacturing and finance find it increasingly difficult – and costly – to do business there, according to the founder of a top market research group.

Shaun Rein gave insights into how to do business in China at the FCC club breakfast. Photo: Sarah Graham/FCC

Additionally, protectionism and nationalism are driving mainland Chinese consumers to buy domestic goods rather than foreign made products, said Shaun Rein, author of the new book The War For China’s Wallet which aims to help companies understand how to profit from China’s outbound economic plans.

At the centre of this domestic boom is President Xi Jinping, who has consolidated Communist Party power by taking firmer control of business and overseas investment. The world’s largest or second largest trading partner for most countries, China is seen as the obvious destination for foreign investment. But President Xi’s campaigns, such as the crackdown on corruption, and the economic punishment of countries that speak out against China, has created an environment of mistrust among those trying to do business in the country.

“I think it’s clear that not everyone will make money in China,” said Rein, managing director of CMR China, adding: “If you’re on the consumer side, there’s lots of money.

“China is no longer a cheap place to do business. The cost of doing business is crazy high,” he said at the December 12 club breakfast.

Rein pointed out that foreign brands including KFC and Starbucks make a huge profit in China. But he warned that multinationals were increasingly adhering to the political goals of Beijing in order to operate there. Publicly backing the One Belt, One Road initiative – President Xi’s development strategy to establish trade routes between Eurasian countries – is one way of staying in favour with the Communist Party. Those who speak out against China, said Rein, risk economic punishment or outright banishment. He gave the example of the Philippines, whose mango imports to China were blocked after an international tribunal on territorial disputes ruled in favour of the Philippines. The block was lifted once Rodrigo Duterte came to power in the Philippines and declared allegiance to China over America.

“The theme of the book is that China punishes and rewards countries,” Rein said. But he added that now China has also started punishing foreign companies for the actions of their countries’ governments, citing South Korea’s Lotte Group, which provided land in South Korea for the U.S. THAAD missile system.

Rein said the “methodical, systematic plan” to garner support for the One Belt, One Road initiative was the result of a “divide and conquer” strategy on the part of the Chinese government.

He predicted that multinational financial services would continue to suffer in China, but that foreign insurance companies would flourish, as would wealth management.

Generation HK, a new Hong Kong nation and a collision course with Beijing

Journalist and author Ben Bland read a passage from his new book, Generation HK: Seeking Identity in China’s Shadow. Photo: Sarah Graham/FCC

Two days after Chinese President Xi Jinping gave a tough speech reasserting Beijing’s authority over Hong Kong, the spotlight fell on Generation HK as journalist Ben Bland talked about his book on the city’s disenfranchised youth.

During the July 3 club lunch, Bland, the South Asia correspondent for the Financial Times, defined Generation HK, a term he himself coined: “In basic terms it’s those who came of age since the handover… perhaps those who were 18 or younger in 1997.”

He explained that his book Generation HK: Seeking Identity in China’s Shadow, was a series of portraits of young people from varying backgrounds who have grown up in post-handover Hong Kong but feel little connection to the British colonial era, nor do they associate with China. Instead, he said, they are trying to carve out their own identity as Hongkongers, with some even imagining a new “Hong Kong nation”.

In a Q&A session after Bland had given a short reading from his book, he said fuelling this search for an identity was an element of frustration with inequality in terms of housing and employment in the city. Since 2014’s Occupy Central protests, he said, young Hongkongers had become more radical while at same time the Chinese government was increasingly stamping its authority on the city and that “as a result young people are pushing back harder.” Bland added that he believed there was a real risk that young people and Chinese government are on “a quite worrying collision course”.

When asked how much Generation HK could be racked up to the natural youthful impatience of all young people, and how much of it reflected the idea of being “spoilt children”, Bland said: “That’s one of the unanswered questions… At a time when, in many places in the world, people are worried about apathetic youth, these people have gone to exceeding lengths to fight for what they believe in.” He added that he didn’t believe these were “annoying young people who are inpatient”.

Watch Ben Bland discuss his new book, Generation HK: Seeking Identity in China’s Shadow

But he said he believed part of the push back against China happens because “China talks to Hong Kong young people on a different frequency”. Bland said the challenge for China was to engage young Hongkongers.

Bland revealed that writing the book had at times been challenging because wealthier young Hongkongers were reluctant to share their thoughts on universal suffrage and the Chinese government. He did manage to get one man from the “tycoon classes” to talk to him who told him that his British passport had felt meaningless. Bland said Hong Kong’s identity issues don’t just affect the lower classes, but reach across to business people too. But for those with money and business interests it is often easier to do a deal and put moral worries on the back burner.

Generation HK: Seeking Identity in China’s Shadow is published by Penguin Books and is available on Amazon Kindle.