How is Hong Kong strategising for 2047?

What is Hong Kong's pathway to 2047? Since HKSAR's return to China in 1997 under the 50-year One Country, Two Systems principle, which is due to end in 2047, Hongkongers have emphasised Two Systems, neglecting the timeline to One Country. This was a strategic failure of the first order, since Hong Kong elites should have mapped out different scenarios and pathways to 2047, rather than hoping that Two Systems can be maintained or extended beyond 2047, like a renewed lease.

Part, but not all, of the strategic failure lay in the philosophy of "Positive Non-Interventionism," which became a mantra of the Hong Kong Civil Service. Coined by Sir John Cowperthwaite in 1971, then Hong Kong financial secretary, the mindset fitted British colonial policy which saw Hong Kong as a lucrative outpost in the Far East, where non-interventionism meant minimal burden on the British Treasury, maximum freedom for business, and also least likely to provoke the Chinese Dragon. Hong Kong residents were free to develop business—provided they did not interfere in politics. The Hong Kong civil servants were trained to execute policies essentially formed by the British governor, who referred to London every day. What American economist Milton Friedman praised as "laissez-faire" made economic sense with political reality, as Hong Kong was a borrowed place on borrowed time.

From a server economy to the British mainframe, Hong Kong politicians and civil servants had to switch to autonomy under the Basic Law in 1997, but true sovereignty rested in Beijing. The Hong Kong-US dollar link fitted everyone's strategic and political goals, because the US and China were on the same side since the 1972 rapprochement. But this was where Hong Kong democrats and liberals forgot political realism. What happens if there is a US-China rift in which Hong Kong is caught in the middle?

In 1997, Hong Kong was an economic and financial asset to China, but a potential political liability. Anyone who did simple projections of Chinese growth would have known that by 2047, China would be at least a major—if not the top—economic power, in which Hong Kong would play an important but lesser role relative to Mainland centres such as Shanghai or Guangdong/Shenzhen.

In hindsight, Hong Kong neoliberals made the same three mistakes that Singapore foreign affairs guru Kishore Mahbubani attributed to American elites on recent US-China rivalry: metaphysical, ideological, and strategic. The first is to assume that China becoming rich would become more like the US. The second draws the semi-religious line between "good" capitalism versus "evil" communism, forgetting that the pot is calling the kettle black. Third, the US entered a strategic fight with no clarity in strategic goals, other than maintaining the Number 1 status.

Those who believed in limitless freedom and democracy did not accept the reality that no one can poke any Great Power, not least the Dragon, in the eye without any consequences. And with gridlock at the LegCo (Legislative Council of Hong Kong) level, there was no way that the Hong Kong authorities could implement any policy to compete at the economic and technology levels against the Mainland cities that are roaring ahead with state-market partnership. And not being able to reduce internal inequality because of the inability to provide cheap housing, Hongkongers felt left behind in the same way that the American middle-class felt alienated by neoliberal policies. Strategic policy drift is a disaster when the neoliberal free market promises prosperity, but it is unequally shared. What's worse, reliance on the market, when the competition has state-market partnership with the capacity to implement and execute change, signals slipping behind.

Now that the National Security Law is a reality, what are Hong Kong's strategic options to 2047?

Hong Kong Special Administrative Region (HKSAR) Chief Executive Carrie Lam's recent 168-page 2021 Policy Address has a formidable list of proposed actions and programmes, without spelling out clearly the strategy and philosophy behind the address. The address focused rightly on three priority aspects: national security; integration spatially with the Greater Bay Area through the Northern Metropolis and synchronising with the National Five-Year Plans; and addressing citizen well-being by investing in net zero emissions, housing, education, healthcare, youth, and a liveable city.

The priorities and sensitivities in the address can be seen from 28 mentions of the term "National Security," seven for "climate change," and zero for "social inequalities." Instead, the last item, probably the biggest driver of citizen unrest, was addressed as "social inclusion."

The real social issue facing Hong Kong is a conflicted identity. Hong Kong has always been a Cantonese city where the elite has global pretensions, without clearly identifying with Greater China. That sowed divisions within the city which must be healed, but how to achieve that is a monumental task that must be addressed through action, rather than just rhetoric.

In the "Great Delusion: Liberal Dreams and International Realities" (2018), author and Chicago professor John Mearsheimer argued that "culture alone is not enough to hold a society together. There are three other ways to keep a society intact. One is to create a foreign bogeyman sufficiently fearful to motivate the society's members to work together to defend against the threat. Another is to unify a majority by defending a treacherous 'other' within the society itself. But the most important way societies prevent disintegration is by building formidable political institutions for which there is no substitute."

Simply put, the US is casting China as the enemy to get bipartisan politics to work together. Both parties are demonising each other to win votes, but building strong institutions to hold society together remains key. Blaming Beijing for Hong Kong's ills echoes the first trait, whereas LegCo politics creates gridlock. Alas, little has been done to engage the youth so that they, who will inherit the city by 2047, will feel that they care and share that common future.

Delusion is vision without execution. Why has it been so difficult and slow to build affordable homes for Hongkongers? Transforming caged homes to a realised Common Prosperity is the real strategic priority and litmus test to re-heal a divided society.

That is a formidable task for any chief executive.

Andrew Sheng is adjunct professor at Tsinghua University, Beijing and University of Malaya. He was formerly the chairman of the Securities and Futures Commission, Hong Kong.

This article was based on a presentation to the Vision 2047 Foundation.

Copyright: Asia News Network