• Thu
  • Sep 18, 2014
  • Updated: 12:05pm
CommentInsight & Opinion

Growing anti-Beijing sentiment is shifting focus away from Hong Kong's real problems

Han Zhu says it's unfair to blame Beijing for the conflicts in Hong Kong society that stem from rising social injustice as the city becomes increasingly marginalised in a globalised world

PUBLISHED : Monday, 07 July, 2014, 5:32pm
UPDATED : Tuesday, 08 July, 2014, 2:12am

Hong Kong saw another big demonstration on July 1, when more than 100,000 people marched against the local government and Beijing. Despite having established an even closer economic relationship with mainland China since the handover, anti-Beijing sentiment has now become prevalent in the special administrative region.

But this is a manufactured problem. Beijing has been adhering to the "one country, two systems" policy on Hong Kong since 1997. Interference in Hong Kong affairs has been minimal. Instead, Beijing has offered tremendous assistance and support during difficult times.

The so-called "contradiction" between Hong Kong and mainland China is being propagated by those who want to shift the focus away from real conflicts within Hong Kong society. In the past decade, Hong Kong's economy has become increasingly marginalised in the wave of globalisation. Domination by big businesses, the gap between rich and poor, and social injustice have all got worse. Taking advantage of such internal conflicts, some foreign political forces and local politicians have shifted the blame to Beijing and mainlanders. No solution can be found without recognising this reality.

Manufacturing, once employing 20 per cent of the working population, was a pillar of Hong Kong's economy. As globalisation and China's market reforms took off, Hong Kong's manufacturing sector contracted as factories moved north. From about one million in the early 1980s, the number of Hong Kong workers in the manufacturing sector had dropped to about 20,000 last year. While this is a common problem for all developed economies, Hong Kong suffers much more than its Western counterparts for one reason - the West, with its leading position in hi-tech and luxury brands, is still making high profits globally, whereas in Hong Kong, low-end jobs in retailing, food and beverage, logistics, and transport have become the only options for ordinary working-class citizens.

Secondly, property prices have skyrocketed. Moving north enabled Hong Kong factory owners to reap huge profits in the 1980s and 1990s. The profits, however, didn't stay in China and flowed back to Hong Kong, mostly into real estate.

As a result, Hong Kong has become polarised, with big businesses and low-end workers increasing while the middle class is disappearing. Society has entered an unstable phase.

In the past decade, Hong Kong has received more than 120 million mainland tourists under the individual visit scheme. This has lifted four key industries - tourism, servicing, finance and transport. It has also provided plenty of low-end employment opportunities and plays a significant role in keeping the current unemployment rate low, at 3 per cent.

However, this development contributes only marginally to economic growth. In 2012, while mailand tourists' consumption created HK$26.1 billion of added value, that was equivalent to only 1.3 per cent of gross domestic product. In other words, it helps prevent massive unemployment, but the jobs it helps to create remain mostly low-end. The real winners are Western luxury brands and local landlords.

According to Forbes' ranking last year, the four richest men are all property developers. Land domination is nothing new in Hong Kong. The "big four" developers held a 55 per cent market share by the end of last century, leaving almost no room for any new player. Making astounding profits, big developers subsequently bought public utilities and services. Nowadays, Hong Kong's transport and energy companies and even supermarkets are concentrated in the hands of big developers.

Meanwhile, as the middle class keeps shrinking, the real income of ordinary people has been decreasing. The nominal incomes of most people remain unchanged since the handover - a university graduate earned about HK$10,000 per month 10 years ago; now, it is basically the same. However, everything else - property prices and rent in particular - has risen sharply. As the real income of ordinary folks is falling, big developers keep accumulating astounding wealth. This sharp contrast has caused strong discontent among the population.

Meanwhile, according to the Sino-British Joint Declaration and the Basic Law, Hong Kong's political system shall remain unchanged for 50 years. In fact, that has not exactly been the case since the handover.

Beijing, when drafting the Basic Law, did promise to allow a change in Hong Kong's system; that was, transitioning from a system under which the governor controlled everything to a more democratic one. Under the Basic Law, the power of the chief executive and the make-up of the Legislative Council are very different from those under the colonial system.

Before the handover, the governor had all the power, with both the Executive Council and Legco firmly under him. Legco was more or less an advisory and not a legislating body. The governor controlled the appointment of the legislators and the agenda of the legislature. Members had no power to initiate any motion. In the SAR, the executive branch has become a weak government hindered by a much more powerful legislative branch.

Another major political change lies in the role of the sovereign power in Hong Kong. The British government could fully exercise its political will in Hong Kong. For example, when London demanded Hong Kong bear half of the expenses of the British military stationed in Hong Kong, the colony could not say no. After the handover, while Beijing holds the final governing power, this power has been delegated to the SAR government. If one compares how Beijing is and how London was controlling Hong Kong, the differences couldn't be starker.

The crux of the matter is that the opposition in Hong Kong is trying to do away with the Basic Law and contradict the Chinese constitution. They want to negate Beijing's ruling power and give Hong Kong complete "autonomy". That's the fundamental reason why the radical opposition is promoting a "contradiction" between Hong Kong and the mainland by trying to shift the blame for Hong Kong's internal conflicts onto the central government.

Contrary to the promise of keeping things unchanged for 50 years, as stipulated in the Joint Declaration, there has been too much political change in Hong Kong. While the SAR does need reforms, such changes can't be towards a break-away from the central government, ruining the rule of law, destroying the economy, inciting civil strife and splitting society.

Hong Kong doesn't need any political movement to provoke internal conflict. The radicals will never achieve their aim, but in the process of trying, they might destroy Hong Kong. What Hong Kong needs are economic reforms to deal with the marginalisation caused by globalisation and political reforms to design a redistributive process to address social injustice.

Han Zhu is a columnist for guancha.cn This is an edited version of an article translated from Chinese and distributed by the Guancha Syndicate


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This article is now closed to comments

Han Zhu, your article is good. I like it.
Hey calyth, your premise is that the CCP has nothing to do with the wealth imbalance and the money stolen from HK in these Massive Event Funds which were created to siphon money off to some corrupt cadre. Since the HK govt has been nothing more than a front to pretend BJ is not making all decisions, including who gets TV licenses and where 30% of HK's electricity will come from, it is easy to see how the mismanagement of China, in general, is now showing up as mismanaging HK. Same incompetence, same corruption driven incentives. HK's social ills are a direct result of poor policies or policies deliberately made to damage HK society. Like, how ignorant must someone be to believe for 15 years that the "luxury goods" market is not infact a system to launder money from thieving cadres? Who actually buys 17 watches at a time? What, they just discovered that UnionPay is really good for money laundering and exporting stolen money from China? But, look what the state sponsored money laundering did to HK rent prices so that long time restaurants and McD had to close? How were the working poor going to have enough to pay $3500 for a 1/7 divided flat? Is that a cause of a social ill? If you were born in HK or TW or China, your Canadian passport is not recognized. Chinese laws apply to you as does the lack of rule of law.
So here's the truth - you have a mandarin name, and the Hong Konger would simply disregard what you said based on an ad hominem attack; you spoke of colonial history as the way it is, while the typical Hong Konger reminisce in what they thought it was.
You're absolutely correct that there are other social ills, real social ills that are causing a lot of problems now and in the near future, but the Hong Kongers are so blinded by the fact that they can't "choose" their CE, not to realize that having the ability of choosing your government doesn't actually translate to a hell of a lot of power to change how the economy is going to be. People don't want to see that even if they were able to vote Long Hair as CE, either he will have to compromise with the 800lb economic gorilla named China, or he's going to pretty much ruin it for everyone.
I'm fortuante - I have citizenship elsewhere, and I can exercise my right to have a say on who gets to be government. I recently voted against a guy who claimed that he will be able to create 1 million jobs in my province - not because I believe he was evil, or a puppet of someone else, but because I know that what he's claiming to do is pure fantasy.
Hong Kongers won't be able to understand that, until they get to choose their government and see it fall.
Cut the Gordian knot. Let them choose the path, see if it would lead to ruin.
Not a bad article if rather biased and lop sided by a person who is clearly a Communist. Is this another example of a Beijing Mouthpiece being given the opportunity to 'tell' us what to do, i.e. shut up and behave. To be honest I don't think many people in Hong Kong care about democracy. Yes they want freedoms that are not enjoyed in China but what they want most is a stable and fair society. It is here that the Government of the HKSAR is failing to deliver.
The government fails to deliver because HK is more of a US style system than a Westminster parliamentary system - i.e. The executive branch is independent of the LegCo. So the government itself, all politics aside, is susceptable to getting hamstrung; just like how Clinton had to deal with a Republican congress, or Obama for that matter.
Why is it that a because the author is Communist, we shouldn't give him a fair hearing? Has HK descended to McCarthyism? Oh wait, don't answer that.
You're correct in terms of Hong Kongers want a fair and stable society, but that requires leveling out the upper class and the lower class. It's not a simple problem as installing a "pro-democratic CE" by being able to vote for one.
Realty prices is through the roof, not (just) because of collusion, but because the tax base is **** - ****www.budget.gov.hk/2014/eng/pdf/head003b.pdf It's all profit tax. But hey, when the exectutive branch proposes GST, it was immediately shot down based on knee jerk reaction than actual contemplation.
I do think Hong Kong should get the vote now - then they would find out what kind of shape it actually is in, and whether those in the LegCo who always says Nay can actually lead.
Hong Kong has numerous problems. The city lacks high-end industries other than financing, banking and professional services. The property price is soaring but the attempt to develop new town and housing was under fire. The monopoly in certain industries in the territory is by no means easy to address.
All these are serious and vivid problem. In comparison, the conflict between Hong Kong and Beijing is a bit imaginary.
Runa Zachary
Good article, I think Chief Executive leung chun-ying always do something to show that he is inclined to Central government but I think he is a fake gay who wants to stimulate Hongkongers to hate China, because of he bad, fake and dishonest attitude, records and behavior for Hong Kong people that he is a follower of Central government, actually he is inclined to Western like UK, USA because of his businesses and some beneficial relationship. I am disappointed by this politics in HK's situation nowadays, pitifully we even have no choice to choose our leader, interfere in policy, and no way to trust or influential in our government. Nominally we are returning to China, factually we are controlled by UK, USA.
An accurate assessment of the problems Hong Kong faces. Yet how to achieve reforms to design a redistributive process to address social justice without some basic change in taxation and other economic policies? I suggest Chinese government has more confidence on the electoral outcome and avoid direct confrontation and let it play out.
Han Zhu has made a coherent argument here for the problems we've been facing in HK, much more sensible than the ones from Global Times.
Surprisingly good article.




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