Rimsky Yuen's claims that vote row will lead to downgrade are rejected

Think tanks reject Rimsky Yuen’s claim that row may lead to economy’s downgrade

PUBLISHED : Friday, 14 February, 2014, 4:12am
UPDATED : Friday, 14 February, 2014, 5:04pm

Justice Secretary Rimsky Yuen Kwok-keung has been criticised for speculating that global think tanks would downgrade Hong Kong's economic ranking if people rejected the government's universal suffrage proposal.

A leading researcher behind a global index that has ranked Hong Kong the world's freest economy for consecutive decades said Yuen misunderstood their concerns.

Terry Miller, the leader of the right-wing US Heritage Foundation's index, said Hong Kong in fact could cause political instability by "reneging on" the promise to deliver one man, one vote.

Yuen suggested last month that agencies that could give Hong Kong a poorer score included The Heritage Foundation, Canada's Fraser Institute, which publishes the Economic Freedom of the World index, and the US-based Milken Institute.

Yuen said he feared that a lower rating might "kick-start a domino impact on our trade, our economic development, [and] overall our competitiveness".

He made the plea when asking Hongkongers to accept even an imperfect proposal for the 2017 chief executive election.

But none of the key researchers at the three institutions shared Yuen's view.

"I'm afraid Mr Rimsky Yuen has misunderstood the nature of our concerns," said Miller, whose organisation has ranked Hong Kong the world's freest economy for 20 consecutive years, a record highly coveted by the local government.

"Our concern... is that if the government of Hong Kong reneges on its promises to the citizens of universal suffrage and popular election of the chief executive, that could lead to political instability," he said.

Miller added: "You cannot achieve higher levels of economic freedom by imposing or sustaining restrictions on political freedom. Economic freedom and political freedom go hand in hand."

Professor Jim Gwartney, a co-author of the Fraser Institute's index, said having direct democracy - or one person, one vote - "does not directly affect the rating of any country".

Hong Kong was ranked number one in the world throughout the 1980s and 1990s "when there was no direct democracy", Gwartney noted.

But he added that the impact of reforms towards more democracy "may well increase the confidence of citizens" in the legal system and its protection of property rights, which would result in a higher economic freedom rating.

Keith Savard, senior managing economist of the Milken Institute, said the Global Opportunity Index, which last year ranked Hong Kong first, concerned mainly the rule of law, an area he said had shown little sign of deteriorating.

"Since Hong Kong historically has demonstrated exceedingly high standards in this regard, there is little to suggest that this will change in the foreseeable future," he said.



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