On Hong Kong, finance, and Sino-British relations

Jordi Brown

Chief Politics Correspondent | BSc Philosophy, Politics and Economics, UCL

For the past 12 months, the world has watched Hong Kong in a state of near-constant protest (HKET, 2019). Punctuated only by the coronavirus pandemic, the reasons for these protests are wide-ranging. Grievances on the side of protestors include police misconduct (Jones, 2019), the failure of the 2014 “Umbrella Protests” which sought universal suffrage (DW, 2014), and the use of emergency powers to introduce an anti-mask law (SCMP Reporters, 2019). However, the issue that could be considered to have kick-started these protests in June 2019 was a proposed bill that would allow the extradition of Hongkongers to mainland China and Taiwan (The Government of the Hong Kong Special Administrative Region, 2019). This has always been a contentious issue – the “one China, two systems” framework should in theory provide Hong Kong with broad freedoms and legal autonomy. Many protestors worry that the extradition bill is an erosion of this freedom (Mayberry, 2019).

Eventually, this bill was withdrawn. However, in May 2020 the decision to draft a new national security law on behalf of Hong Kong was proposed by Beijing. This would effectively bypass the Legislative Council of Hong Kong. This law aims to:

safeguard national security, in order to effectively prevent, stop and punish acts and activities to split the

country, subvert state power, organize and carry out terrorist activities and other behaviors that seriously

endanger national security, as well as activities of foreign and external forces to interfere in the affairs of the

HKSAR (Xinhua, 2020)

What many in Hong Kong will see as infuriating is Beijing’s unashamed use of a legal loophole to pass legislation that, in their eyes, should be strictly within the purview of the once-British territory. Perhaps one of the most concerning implications of this legislation is that it will allow China to establish intelligence agencies in Hong Kong (Kuo, China threatens 'countermeasures' against UK over Hong Kong crisis, 2020). The worry here is that agents acting under the jurisdiction of these intelligence agencies will be able to harass journalists and other public figures critical of the government (Kuo & Yu, Hong Kong: what are the implications of China's anti-sedition laws?, 2020). It is this fear of surveillance in the name of anti-sedition that has spurred on the latest round of protests.

What implications will China’s actions, as well as the ongoing protests, have on both China and Hong Kong’s global standing? In response to the manner in which China brought in the national security law, the United States announced that they no longer saw Hong Kong as autonomous from China. The concern here is that Hong Kong’s special trade status with the US could be revoked, potentially plunging the region into the same trade war that has plagued Washington and Beijing for so long now (Manson & Sevastopulo, 2020).

Across the Atlantic, the British government has said that any Hongkongers eligible for a British National (Overseas) passport will have visa rights to enter the UK extended from six months to twelve months and “provide a pathway to future citizenship” (Hughes & Yang, 2020). China is the UK’s fourth largest source of imports, and the UK imported £44.7 billion in goods and produced a trade deficit of £22.1 billion in 2018 (Ward, 2019). In spite of this reliance, the British government has opted to firmly condemn China at a time when cordial international relations will be needed to secure trade deals against the backdrop of Brexit. That Boris Johnson would use the South China Morning Post to remind Beijing of “one country, two systems” and threaten a change in immigration rules speaks volumes as to the UK’s position (Johnson, 2020). On the flipside, Johnson’s actions could be construed as a meaningless gesture. Not only is the British National (Overseas) passport only available to people who applied before 1 July 1997 (HM Government, n.d.), but is it realistic to expect Hongkongers to up sticks and move halfway across the world? China’s response to Mr Johnson is that the UK should “recognise and respect the fact that Hong Kong has returned” to China (Yang, 2020).

Of course, questions will linger as to whether Hong Kong can retain its competitive edge in the finance industry. Currently, banks including HSBC and Standard Chartered have supported the national security law. These firms will want to toe the Chinese line so as to not stoke political instability that is bad for business. Furthermore, they will not want to lose revenue in the Chinese mainland to other banks (Riordan, 2020). But a prolonged discontent among Hongkongers, combined with a possible exodus of immigrants to the United Kingdom, will only harm Hong Kong’s reputation as a financial hub. Indeed, the investment bank Nomura have said that they are “seriously” looking at the scale of their operations in the region (Lewis, 2020).

Hong Kong finds itself at a crossroads. Will the protestors – desperate for universal suffrage and a chance to decide their own history – prevail? But with Chinese president Xi Jinping warning that any attempt at separatism will lead to "bodies smashed and bones ground to powder" (BBC News, 2019), it is hard to see what will stop the world’s second largest economy (International Monetary Fund, 2019).


BBC News. (2019, November 28). The Hong Kong protests explained in 100 and 500 words. Retrieved from BBC News: https://www.bbc.co.uk/news/world-asia-china-49317695

DW. (2014, October 23). Hong Kong protesters reach new heights with democracy banner on Lion Rock. Retrieved from DW: https://www.dw.com/en/hong-kong-protesters-reach-new-heights-with-democracy-banner-on-lion-rock/a-18013822

HKET. (2019, June 9). 【逃犯條例】港鐵四綫受阻 網傳車長特別廣播灣仔銅鑼灣天后可「飛站」. Retrieved from HKET: https://topick.hket.com/article/2372210/%E3%80%90%E9%80%83%E7%8A%AF%E6%A2%9D%E4%BE%8B%E3%80%91%E6%B8%AF%E9%90%B5%E5%9B%9B%E7%B6%AB%E5%8F%97%E9%98%BB%E3%80%80%E7%B6%B2%E5%82%B3%E8%BB%8A%E9%95%B7%E7%89%B9%E5%88%A5%E5%BB%A3%E6%92%AD%E7%81%A3%E4%BB%94%E9%8A%8

HM Government. (n.d.). Types of British nationality. Retrieved from gov.uk: https://www.gov.uk/types-of-british-nationality/british-national-overseas

Hughes, L., & Yang, Y. (2020, May 29). UK widens visa rights offer to almost 3m Hong Kong residents. Retrieved from Financial Times: https://www.ft.com/content/06e30290-1fcb-44cb-9ed6-5f4b0e7ff565

International Monetary Fund. (2019, October). Report for Selected Countries and Subjects. Retrieved from International Monetary Fund: https://bit.ly/37Dg4A2

Johnson, B. (2020, June 3). For Hongkongers fearing for their way of life, Britain will provide an alternative. Retrieved from South China Morning Post: scmp.com/comment/opinion/article/3087252/hongkongers-fearing-their-way-life-britain-will-provide-alternative

Jones, C. A. (2019, November 15). Hong Kong: police legitimacy draining away amid spiral of rage and retaliation. Retrieved from The Conversation: https://theconversation.com/hong-kong-police-legitimacy-draining-away-amid-spiral-of-rage-and-retaliation-127127

Kuo, L. (2020, May 29). China threatens 'countermeasures' against UK over Hong Kong crisis. Retrieved from The Guardian: https://www.theguardian.com/world/2020/may/29/hong-kong-crisis-china-support-police-warns-us-interfere-trump

Kuo, L., & Yu, V. (2020, May 28). Hong Kong: what are the implications of China's anti-sedition laws? Retrieved from The Guardian: https://www.theguardian.com/world/2020/may/28/hong-kong-what-are-the-implications-of-china-sedition-laws-national-security-beijing

Lewis, L. (2020, June 3). Nomura reviews scale of operations in Hong Kong. Retrieved from Financial Times: https://www.ft.com/content/9b4599b2-e16a-498b-978f-326247fd6fac

Manson, K., & Sevastopulo, D. (2020, May 28). US says Hong Kong is no longer autonomous from China. Retrieved from Financial Times: https://www.ft.com/content/3ae02552-6948-47ae-8e53-233bcded6bf5

Mayberry, K. (2019, June 11). Hong Kong's controversial extradition bill explained. Retrieved from Al Jazeera: https://www.aljazeera.com/news/2019/06/explainer-hong-kong-controversial-extradition-bill-190610101120416.html

Riordan, P. (2020, May 4). HSBC and StanChart publicly back China’s Hong Kong security law. Retrieved from Financial Times: https://www.ft.com/content/213c0e2c-f1c7-4637-a0b9-4c3f72709d52

SCMP Reporters. (2019, October 7). Hong Kong protests: tens of thousands defy mask ban as mobs go on rampage against mainland China-linked businesses and MTR. Retrieved from South China Morning Post: https://www.scmp.com/news/hong-kong/politics/article/3031782/hong-kong-protests-tens-thousands-defy-mask-ban-go-rampage

The Government of the Hong Kong Special Administrative Region. (2019, March 26). Fugitive Offenders and Mutual Legal Assistance in Criminal Matters Legislation (Amendment) Bill 2019 to be submitted to LegCo. Retrieved from The Government of the Hong Kong Special Administrative Region - Press Releases: https://www.info.gov.hk/gia/general/201903/26/P2019032600708.htm

Ward, M. (2019, November 5). Statistics on UK trade with China. Retrieved from House of Commons Library: https://commonslibrary.parliament.uk/research-briefings/cbp7379/#:~:text=In%202018%3A,6.6%25%20of%20all%20UK%20imports.

Xinhua. (2020, May 28). Highlights of China's decision on Hong Kong national security legislation. Retrieved from NPC & CPPCC Annual Sessions 2020: http://www.xinhuanet.com/english/2020-05/28/c_139095813.htm

Yang, Y. (2020, June 3). China hits back at UK criticism of Hong Kong security law. Retrieved from Financial TImes: https://www.ft.com/content/27d82ae3-6a4f-4b44-ada1-90692721ac7a


Platinum Sponsors

Gold Sponsors