City Beat | What way out for Hong Kong in US-China trade war?
Compared to 20 years ago, city has limited role to play in easing economic tensions between two superpowers
“A fire at the city gates means calamity for the fish in the moat,” a well-known Chinese saying goes. It applies aptly to Hong Kong, which is at risk of collateral damage as Beijing and Washington exchange “fire” with tit-for-tat trade tariffs.
Understandably, government departments looking after the city’s finance and trade are busy assessing the impact, direct or indirect. Finance chief Paul Chan Mo-po earlier expressed concern that, as a “highly open and small economy”, Hong Kong might end up seeing one out of five jobs affected, as those employed in the city’s trade and logistics industries would be hit, not to mention the volatility a trade war would cause in the financial market.
Trade minister Edward Yau Tang-wah has held several rounds of talks with major business groups, including the American Chamber of Commerce, as well as top US envoy to Hong Kong Kurt Tong, trying hard to head off or minimise any negative consequences.
Although the general sentiment seems to be that the direct impact on Hong Kong will not be huge – at least not yet – it raises one practical issue: can Hong Kong, an independent member of the World Trade Organisation (WTO), be treated separately from mainland China in this latest round of highly politicised tariff retaliation?
Does Trump even have an endgame in trade war with China?
Not really, although that appears to be the government’s hope. It further prompts another question: can Hong Kong convince the United States that the collateral damage to a city under “one country, two systems” will also hurt the interests of the many American businesses here?
Looking back at history helps to reflect on Hong Kong’s role.