SCIO briefing: Views of experts and scholars on Hong Kong's current situation
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E-mail China.org.cn, August 16, 2019
CGTN:
I have a question for you. As we all know, some people say that Hong Kong is of unique significance to China's economy and finance. Now, the demonstrators seem to have the idea of taking advantage of Hong Kong's status as an international financial center to force the central government into submission. What do you think of it? Thank you.
Tian Feilong:
As we know, Hong Kong is an international financial center. In the global financial governance system, there is an expression called "Nylonkong," which refers to New York, London and Hong Kong. When you check the 24-hour global time zone, these three places divide the world exactly into three parts. They are the key nodes of the global financial market order in terms of space and continuity. Large-scale disturbances occurred successively in London and New York around 2011, and we can also study and observe how the U.K. government and the U.S. government as well as the police coped with the riots and violent acts in the financial centers during the two disturbances. The Hong Kong police should also learn from them and adopt a similar standard to deal with and stabilize the status of Hong Kong as a financial center. These can give us a lot of inspiration.
Second, I would like to point out that Hong Kong's status as an international financial center is closely related to the principle of "one country, two systems" and the Basic Law of the HKSAR we established when Hong Kong returned to the motherland. Without them, Hong Kong's status as a financial center will not only be difficult to maintain, but will be even more difficult to consolidate and strengthen. If we haven't forgotten history, we can take a look back. It has been 22 years so far since Hong Kong's return, during which Hong Kong's status as a financial center was actually interfered with and impacted by different forces or in different ways. Some of them were economic in nature, such as major global hot money going short. Others were based on political motives, for example, using the financial center to create political threats. The Asian financial crisis in 1997, the global financial crisis in 2008, the illegal "Occupy Central" movement in 2014, and the anti-amendment movement in 2019 are just four examples of this. Obviously, the crises in 1997 and 2008 were more of the impact that global hot money placed on Hong Kong's status as an international financial center for the purpose of financial arbitrage. The illegal "Occupy Central" movement in 2014 and the anti-amendment movement in 2019 carried obvious political intentions.
Let's review the central government's reaction when Hong Kong's financial system was threatened during these years. Back in 1997, China's economy was fraught with severe difficulties, and we didn't have large foreign exchange reserves. Still, when Hong Kong's financial market faced trouble, the central government offered everything, as much as it could, and spared no effort in propping up the Hong Kong market. As this happened at the very beginning of Hong Kong's return to the motherland, it united the central government, the Hong Kong society and the financial regulatory institutions in both places, and further brought them together as "a community with a shared future for financial security." The 2008 financial crisis also affected Hong Kong. If it hadn't been for the strong and stable economy of the Chinese mainland, I believe that all sectors of Hong Kong and its society would have suffered great losses. With support of the Chinese mainland market and the country, Hong Kong weathered the financial crisis in 2008. As for the incidents happening in 2014 and 2019, they came with very clear political intention. It is ridiculous to undermine the "one country, two system" with Hong Kong's status as an international financial center, since such a position is actually guaranteed by the practice of "one country, two systems." What they are pursuing is actually against their own interests, and this is abnormal and unreasonable.
Whether it is the opposition, the black-clad crowd, or the foreign forces, none of them has thought through Hong Kong's role as a financial center – the financial infrastructure not only for China, but also for economic globalization. Anyone responsible for free trade, economic globalization, and peaceful global development should obligingly and jointly protect Hong Kong's vital role. This is because the infrastructure matters for both China and the rest of the world. If disruption was brought to this financial center, I believe that not only Hong Kong and the rest of China, but also Western countries would be severely affected, especially the U.S. stock market as well as its financial security. Current statistics indicate that due to the continuous violence in Hong Kong, the U.S. stock market and its financial security have already been affected. In this regard, I believe the U.S. decision-makers will make an objective judgement and respond accordingly. In this age of globalization, no country can opt out or is immune to globalizing forces, and we must face this together. In terms of Hong Kong, we should build a consensus that Hong Kong's role as an international financial center cannot exist without the rule of law in Hong Kong. I think all sectors in Hong Kong should listen to reason, reach a consensus on the rule of law to stop violence and chaos and bring back order. Hong Kong's status as an international financial center should be firmly supported by upholding the rule of law. This is my response.
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