The closed minds of our youth are the No 1 threat to Hong Kong’s future

Regina Ip says young people who champion the cause of independence are taking the city further away from a solution to survive – and thrive – in a global economy that’s slowing and in transition

PUBLISHED : Saturday, 11 June, 2016, 11:02am
UPDATED : Saturday, 11 June, 2016, 11:01am

In recent months, pessimistic predictions by eminent economists have cast a pall over the global economy. Lawrence Summers, former US Treasury secretary, pronounced that the American economy could be entering a state of “secular stagnation”. In China, an anonymous, authoritative source declared that China might be becoming an “L-shaped” economy. Hong Kong’s growth crawled to an anaemic 0.8 per cent in the first quarter. With the world economy running out of steam, there is little prospect of Hong Kong’s economy picking up speed any time soon.

China’s cooling imports are sending a huge chill across the global economy

That our fortunes rise and fall in tandem with that of the world should come as no surprise to those who truly know Hong Kong. From early on, the British administrators had decided that Hong Kong’s market was too small to be worth protecting. It would serve Hong Kong’s interests much better by making the whole world its market and the city a free port. Hong Kong thrived on external trade. Post-second-world-war industrialists who emigrated to Hong Kong from mainland China built, through their hard work and entrepreneurship, manufacturing empires as far away as Nigeria and Mauritius.

Hong Kong reclaims crown as world’s most competitive economy

Sir Philip Haddon-Cave, who served as financial secretary from 1971 to 1981 and presided over Hong Kong’s dramatic ascent, observed, prior to his departure from Hong Kong, that the Western rules-based, market-oriented systems, combined with the prodigious hard work of the Chinese people, appeared to have worked miracles. By the early 1990s, Hong Kong’s economic performance had earned such admiration that it was hailed as part of the East Asian economic miracle in a report published by the World Bank.

Following China’s reform and opening up of its economy in 1979, Hong Kong’s manufacturers lost no time in moving their manufacturing operations to mainland China to take advantage of the cheap land and abundant labour. The relocation gave Hong Kong’s manufacturing industries a new lease of life. But the abundance of cheap land and labour also took away Hong Kong manufacturers’ incentives to add more value by creating their own brand-name products or by making greater use of technology.

Now a predominantly service-oriented economy, many Hong Kong manufacturers have lost the drive to keep their productions competitive in the cheaper and harsher interiors of China or further afield, in Bangladesh or Sri Lanka. But as an international financial centre and “premier business hub”, as the city is fond of calling itself, it is as important as ever to keep its markets and, above all, the people’s minds open.

Hong Kong hits four-year low in quarterly economic growth

One consequence of the globalisation of the economy from 1998 to 2008 is that, as Serbian-American economist Branko Milanovic pointed out, income inequality has widened and the lower middle classes in developed countries with moderate skills have lost out to the emerging middle classes in China, India, Thailand and Indonesia.

Students who have not had the occasion to earn their living care little about how Hong Kong is going to maintain its standard of living

China’s rise has affected Hong Kong’s moderately skilled classes in much the same way that it has affected the developed world. Hordes of Chinese tourists cause varying degrees of dislocation and imbalance of supply and demand wherever they stalk. In Hong Kong, highly competitive students, professionals and enterprises from mainland China pose unwelcome threats in some quarters. While competition is known to have bred resentment, shutting out China by advocating independence of the “Hong Kong race” is no prescription for the decline of our economic fortunes and the erosion of our self-confidence.

Students who have not had the occasion to earn their living care little about how Hong Kong is going to maintain its standard of living in the years to come. But their efforts to build a great wall of separation from mainland China by opposing the use of simplified Chinese characters and Putonghua (China’s lingua franca) for whatever purposes is fatuity of the highest order. Quite apart from the fact that Putonghua is used by over 1 billion people and is increasingly important for the purpose of doing business with the second-largest economy in the world, the closing of one’s mind to a language would close one’s mind to an entire society. There is nothing more worrying about Hong Kong’s future than the closing of young minds to important changes taking place around them.

An open debate is the best way to curb talk of independence

Populist or liberal: What kind of democracy does Hong Kong really want?

The flip side of the rejection of mainland China, for whatever reason – political, cultural or ideological – is the self-righteous, holier-than-thou attitude in pitching one set of values – rights and freedom, democracy – above all others which have served Hong Kong well – the relentless work ethic which has transformed barren Hong Kong into an East Asian economic miracle; tolerance, mutual understanding and respect; love of harmony and stability; and openness to new ideas and developments.

Liberal democracy has no doubt served the Western world well, but doubts arise as to how many who seem poised to crusade in the name of freedom, democracy and self-determination have really grasped their true meanings, their challenges and pitfalls. To be rejectionist without thinking, to follow borrowed ideas without thinking, and to allow such habits of mind to fester among the young – that is the greatest threat to Hong Kong’s future.

Regina Ip Lau Suk-yee is a legislator and chair of the New People’s Party