Hong
Kong has been through a tough and eventful year. The government's
pursuit of new national security legislation evolved into one of
its largest tests since the handover in 1997. SARS was an unwelcome
surprise that continues to cast effects as people worry that it
might resurface in the months ahead. Retail and service industries
suffered, and, although related service industries have
substantially revived, there was genuine and significant economic
pain associated with the spring 2003 outbreak of this new
disease.
News
from the economic front has been largely bleak:
Deflation-accelerated as of June 2003 stood at -3.1 percent;
unemployment ticked down to 8.6 percent; the rise in negative
equity mortgages in the second quarter was 27 percent; the
financial sector in Hong Kong has cut more than 5,700 jobs since
March 2002--the list goes on. But the government has demonstrated
initiative and seems determined to come to grips with the
challenges associated with Hong Kong's changing circumstances.
Very
recent news in the property and retail sectors is encouraging. Some
estimates for GDP growth for 2003 were revised upwards at the end
of last month to 2.0 percent. The Closer Economic Partnership
Arrangement, increasing momentum behind the building of
infrastructure that will connect the crowded and developed eastern
with the less developed western portions of the Pearl River Delta,
new measures to increase the flow of visitors from southern China,
the development of a center for the study of infectious diseases
with support from the international community, including the U.S.
Centers for Disease Control--all of this and more adds up to an
emerging sense of renewed vitality in Hong Kong.
But
the real change in outlook in Hong Kong goes back not just to
fiscal, social, or trade policy steps undertaken by the government.
It is not just a response in Hong Kong to the new leadership team
taking charge in Beijing in the aftermath of the 10th National
People's Congress last spring. And it is not just a reflection of
emerging optimism about the revival of the U.S. economy.
July 1: A Watershed?
The
real change in Hong Kong this summer arises directly from the
remarkable expression of popular will that occurred on July 1. The
people of Hong Kong spoke with unmistakable clarity in a show of
the kind of unity of purpose that has been sorely lacking among
their elected and appointed leaders. They spoke of their desire for
more effective and more responsive government. They called for a
course correction, a new direction calculated on the basis of the
best interests of the Hong Kong people, interests that they wanted
to have a hand in defining.
And
they spoke in such large numbers, with such patience, fortitude,
wisdom, and maturity, that their voices had a most telling and
significant effect. It was a remarkable episode, one that will go
down in the books as perhaps the single most important event in
Hong Kong's short political history since the handover in 1997.
Before exploring further the implications
for the future, let us clear away some of the misapprehensions
associated with July 1 by examining what it was not. It was not the
work of outsiders bent on undermining the sovereignty of the
People's Republic of China over Hong Kong or the work of ideologues
determined to oppose the Communist government in the PRC.
The
July 1 demonstration of popular will in Hong Kong was homegrown. It
was an accurate reflection of widely held views among the middle
class in Hong Kong, and it was directed at the government of Hong
Kong, not the central authorities in Beijing. Moreover, it was not
just a referendum on the property market or the government's
fruitless efforts to stem the tide of unemployment, and it was not
a walk in the park during a local holiday by an essentially
apolitical people.
Although one would have to conclude that
the frustrations of six years of deflation and the uncertainty
associated with economic restructuring in Hong Kong have to weigh
heavily on the minds of the citizens of Hong Kong, the
precipitating factors that brought the middle class out into the
streets were primarily political, not economic. One doesn't have to
dig too deeply to identify the single most important issue that
brought people to demonstrate--with civility and patience--against
their government. The government's handling of new national
security legislation was the immediate focus of the demonstration,
but most observers believe that the people's concerns went well
beyond the specific provisions in the text of the government's
proposed new law.
To
put it as succinctly as possible, it appears that the Hong Kong
people, frustrated by the government's handling of the new national
security legislation, want political restructuring to go along with
the revisions of the economic structure that are underway. Doctors
and dentists and clerks and shopkeepers joined together on July 1
to complain that the system was broken.
Dialogue between the government and the
people shouldn't require a street protest by half a million people.
There must be a better way if Hong Kong is to compete with other
economies that are afforded the full participation of their
citizens.
And,
in fact, the Basic Law in Hong Kong points toward a better way in
its Articles 45 and 68, which provide a mechanism for the ultimate
goal: the election of the legislature and the selection of the
Chief Executive by universal suffrage. It may take some time to
build the institutions of democracy in Hong Kong, including
stronger political parties, better mechanisms and greater resources
to improve the quality of district council campaigns and local
governance, and the emergence of leaders in political and social
life who are trained to build public consensus and unity in the
free-for-all that is life in democratic society.
One
has to recognize that Hong Kong has a way to go yet before these
institutions are fully formed and mature. The sooner that Hong Kong
begins to strengthen and expand these building blocks of democracy,
the better for all concerned.
The Hong Kong Government Responds
This
is a conclusion that is not lost on the Hong Kong government. The
government was late in responding to the message of July 1. There
was a moment in early July, after the demonstration but before the
scheduled vote on new national security legislation, when it
appeared that the government intended to press ahead with the vote
beginning with what is known as a "second reading" on July 9. No
one will know how badly that might have turned out because events
led--fortunately--to the postponement of a vote on the bill.
To
the government's credit, it has followed up that constructive
decision with additional positive steps. The Chief Executive
announced September 5 that the Hong Kong government had withdrawn
the national security legislation from formal consideration by the
Legislative Council.
We
welcome this good news for the Hong Kong people. The Secretary for
Security has made clear that dialogue with the Hong Kong people on
the salient aspects of the controversial legislation will continue,
that the government has neither ruled in nor out proceeding in the
future on the basis of a "white bill," and that in any event the
government will not seek to advance the new legislation without the
people's support.
From
our perspective, this is as it should be. We welcome the
government's intent to secure the community's approval before
enacting new national security legislation.
The Mainland's Perspective
Article 23 of the Basic Law calls for Hong
Kong to enact laws "on its own" to prohibit treason, secession, and
the like. That phrase--"on its own"--is important, for it points to
Hong Kong's greatest possible autonomy under the "one country, two
systems" structure given to Hong Kong by the mainland for 50 years
from 1997. There is every indication that the central authorities
in Beijing continue to value highly Hong Kong's system.
My
view is that we can safely dismiss the more capricious rhetoric
from PRC officials in the immediate aftermath of July 1: It is
evident, both from July 1 and thereafter, that the people of Hong
Kong were not intent on revolution (cultural or otherwise). On the
contrary, it is quite clear that the demonstrators went to
exceptional lengths to focus their complaints precisely on the
government in Hong Kong. As Martin Lee and others have written, the
people of Hong Kong called for their government in Hong Kong to
improve its performance, not to seek independence from the
mainland. The middle class in Hong Kong can demand more effective
and responsive government without radical surgery on the body
politic.
Indeed, since the July demonstrations, the
central authorities have fully supported the Hong Kong government's
conclusion that there should be no predetermined timetable for
passage of the new national security law. It will be important for
Beijing to be similarly supportive of the Hong Kong government's
efforts to advance the Basic Law's provision for progress toward
universal suffrage.
The U.S. Stake in Hong Kong's Getting It
Right
In
plain language, the U.S. has an interest in the Hong Kong
government's, first, "getting it" and, second, "getting it
right."
Does
the Hong Kong government get it? That is, has the people's
expression of political views on July 1 fully registered with the
authorities? I believe the actions of the Hong Kong government
since July 1 indicate that it and the central authorities in
Beijing do indeed understand the profound implications of what
transpired on July 1.
Only
time will tell if the government "gets it right" in response to
popular demands, but one very encouraging sign is the government's
recognition that they need to ask the people whether the government
is on the right track. The Chief Executive, the Secretary for
Security, legislative members from the entire political spectrum,
and other government officials are engaged in outreach and active
listening, seeking to learn from and build upon the views and
concerns of their citizens. The world will be watching to see
whether Hong Kong's people and government are on the same page.
It
is only natural that the Hong Kong government would need to make
adjustments to its policies since 1997, given the new ground that
is being cultivated in the Special Administrative Region (SAR).
This is virgin soil that requires original, creative thinking for
the implementation of the "one country, two systems" formula.
The
challenge to the Hong Kong government, it should be recognized, is
steep. Six years since 1997 is a very short time for a politically
inexperienced leadership to "get it right." The question should not
be whether they are always right--how many governments are?--but
whether there are mechanisms in place to raise alarms when the
government is headed in the wrong direction and to allow for
mistakes not only to be corrected in the present, but also to be
avoided in the future.
The
United States cares about the answers to the fundamental questions
facing the Hong Kong government because we have long-standing ties
and a deep and abiding friendship with the Hong Kong people;
because we have political and economic interests invested in Hong
Kong's success as a thriving free-market economy and a vital civil
society on the border with China; and because our security and law
enforcement relationships provide mutual benefits to the American
and Hong Kong people.
The
Hong Kong Policy Act, recognizing these interests, provides for
unique policy treatment of the Hong Kong SAR to match its unique,
international character. The Act requires the Administration to
evaluate the degree to which Hong Kong is living up to its end of
the bargain. Again, speaking as plainly as possible, it is up to
Hong Kong to advocate for itself, to do its part in our bilateral
relationship to sustain the special treatment that the United
States provides under the terms of the Hong Kong Policy Act.
The
Hong Kong people have earned praise for their remarkable
demonstration of political will peacefully expressed on July 1.
Everyone in Hong Kong should feel proud of this achievement, one
that was based on and evidence of the core attributes that make
Hong Kong a special place: its vibrant civil society, a thriving
independent judiciary, profound and widespread respect for the rule
of law, and strong fundamental freedoms, including the freedoms of
assembly, speech, the press.
But
Hong Kong has discovered since 1997 that, like its competitors in
the global marketplace, it cannot afford to rest on past
achievements. The foundation for development of democracy in Hong
Kong is very strong, but if the people are to participate fully,
new mechanisms and institutions will be required.
Americans' Desire to Support the People of
Hong Kong
The
Hong Kong people should--and, if July 1 is any indication,
will--decide their own future in Hong Kong. The United States
stands ready to help in many different ways. We will sustain our
productive bilateral ties in areas ranging from common efforts in
the war on terrorism to advancing trade liberalization in the Doha
Round. We have experience in areas ranging from containing hospital
infections to building stronger political parties that might be of
use to individuals and institutions in Hong Kong.
We
offer our experience as a resource for the people of Hong Kong
because we have high hopes for the Hong Kong SAR. We respect what
the entrepreneurs and free traders in this historic port have
achieved and want to see their spirit persevere for their own
benefit, for the benefit of citizens pursuing economic reform on
the mainland, and for the benefit of all of us who gain from Hong
Kong's significant contributions to the global trading system.
Dangers of Dashed Expectations?
Observers have pointed with trepidation to
the dangers of mass movements in China. Might the legacy of July 1
be a series of dashed expectations? Could the potential for chaos
or instability lead the mainland to crush this budding move toward
greater democratization? The question is being asked, and it
deserves discussion.
If
the July 1 demonstration had been radical in intent and origin,
perhaps people in Hong Kong might be more concerned. But the
demonstrators sought not to go to the roots of Hong Kong's social
and political structure. These were people who themselves have deep
roots in Hong Kong and who want to see it prosper.
What
did the July demonstrators expect? Simply a better government, a
more responsive government, and more of a voice in government
decision-making. They sought answers to the years of political and
economic questions that have been piling up since 1997.
These are the demands of a people still
invested in and thoroughly committed to the current system. We
should praise the Hong Kong people not only for their carefully
reasoned and heartfelt call for action on July 1, but also for the
perseverance over the course of the past six years as they have
continued to pay their mortgages and work hard at their jobs to get
Hong Kong through this rough patch.
American investors or businessmen and
women should not be concerned about the political stability of Hong
Kong. On the contrary, the fact that Hong Kong's middle class spoke
out on July 1 was a tonic for what ails the SAR. This was a healthy
sign as Hong Kong sought--and seeks--to heal itself.
My
guess is that Hong Kong will come through this test stronger as a
result. We Americans have had that experience. Adversity has made
us more vigorous, more capable, and, yes, wiser.
It
has been said that we don't receive wisdom. We must discover it for
ourselves after a journey that no one can take for us or spare us.
I believe the people of Hong Kong are well embarked on such a
journey, and the American people wish them Godspeed.
James R. Keith is U.S.
Consul General in Hong Kong.