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Why is Hong Kong so important to China—power, profits or prestige?

Wang Li

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[yt_dropcap type=”square” font=”” size=”14″ color=”#000″ background=”#fff” ] S [/yt_dropcap]ince the handover of Hong Kong from British rule back to China in 1997, the central government in Beijing has granted the city the special status in terms of the “special administrative region” (HKSAR). According to the principle of “One country, two systems” that was initiated in the 1980s by the late Chinese leader Deng Xiao-ping, Hong Kong was allowed to “enjoy a high degree of autonomy, except in foreign and defense affairs” for the next 50 years.

This means HKSAR has its own legal system, multiple political parties and its mini-constitution to enshrine the basic civil rights in terms of the democratic procedures of the West. Considering the stark contrasts between the mainland China and Hong Kong in the 1980s, this is truly an innovative idea and daring practice. Otherwise, the unconditional handover of Hong Kong back to China would not be so smooth and the governing of the former colony by Beijing would not be so successful. Here the question arises why Hong Kong is so important to China which has been seen as a rising power with an ambition likely to end the hegemony of the United States?

Frankly speaking, now Hong Kong has become one of highly competitive global trading and financial hubs primarily during the past two decades. As a former British colony, it had laid down the sound legal and financial systems, yet all its current economic, technological and social weights have been resulted in China’s reform & openness initiated in the 1980s. As former U. S. Consulate General Burton Levin said in 1994, “Under British ruling for 155 years, Hong Kong had enjoyed full freedom of speech and religions but never democracy.” Especially to the people of China, Hong Kong is more than a colony but a bitter memory of “the century shame of the ancient country”.

Yet, in 1949 when the People’s Republic of China was founded, the government in Beijing did not retake Hong Kong back immediately. Even during the cold war, Britain was the first major power of the West recognizing the P.R.C. as the legitimate government of China in 1950 and posted a chargé d’affaires ad interim in Beijing from 1954 until 1972 when China accords full recognition to HMG, permitting the exchange of ambassadors. Considering the severe sanctions imposed by the United States against China of that time, Chinese Premier Zhou En-lai not only facilitated the Sino-British trade committee as semi-official trade body (later merged with the Group of 48), but also made HK as the key “window” to the outside world. Under the circumstances, Hong Kong did serve as a channel to help China obtaining various technologies, economic items and foreign currencies, which were so invaluable to China for it was eager to develop but was isolated by the US-led Coordinating Committee for Export to Communist Countries. The hidden role of Hong Kong as a “window” was not finished until 1972 when the Sino-United States’ rapprochement was made in light of the realpolitique of the world affairs.

When China started the reform and openness in the late 1970s, Hong Kong had also changed impressively in terms of garments industries, public housing program and general living standard. For sure, this rapid industrialization was driven by textile exports, low-cost manufacturing items and re-exports of good to China. In addition, efforts were made during the 1970s—1980s with the view to improving the public services, environment, social welfare and infrastructure, which in turn laid the foundation for Hong Kong to establish itself as the first of the “four Asian tiger economies”. Due to this, Hong Kong naturally came to be the vital gateway for mainland China to draw relatively competitive manufacturing know-how, financial management, and foreign direct investment into the economic areas in southern China which were opened up to foreign businesses. This is not one-way benefit since Hong Kong needed to transfer its low-skilled and massive-labor industries to China. Under the win-win formula, Hong Kong has developed itself as a global financial center along with London and New York city, a regional hub for logistics and freight, one of the fastest-growing economies in Asia and the exemplar of laissez-faire market policy globally.

However, in retrospective, people in Hong Kong and the British public as well have always reviewed the past two decades with obvious ambiguous sentiments. Back then in 1997, cosmopolitan and glittering HK city served as China’s gateway to its future dream and many believed it would stay that way for years to come. Fast forward 20 years, it is no longer the only jewel in China’s crown, with cities such as Shanghai, Shenzhen and Guangzhou becoming financial and technological innovative powerhouses. As HK politician Martin Lee observed, “I couldn’t have thought that China’s economy would develop so quickly … and Hong Kong’s bargaining power would diminish so fast.”

Would Hong Kong remain China’s golden goose in the next decades? The answer seems to be given by Chinese President Xi Jinping on June 30 during his three-day visit to Hong Kong for the historic anniversary of the handover of HK from British rule back to China in 1997. In a brief speech at the airport, Xi reaffirmed that Beijing’s central government “has always been a patron of Hong Kong, and will as always support HK’s economic development and improvement of people’s welfare.” Looking forward into the next 30 years, he promised that Beijing was to work with all sectors of Hong Kong’s society in maintaining its extraordinary achievements of the past decades and would ensure “one country, two systems” moving forward in light of social stability in Hong Kong.

No doubts, Hong Kong will act as the key player in China’s century project of “the Belt and Road Initiative”. The reasons behind are as follows, since its return to China, Hong Kong has kept its distinct features and strengths, including its vibrant metropolis where the East meets the West remains as strong as ever. For example, Hong Kong’s leverages are its knowledge of finance management, global trade and technologies innovativeness, the Guangdong-Hong Kong-Macao Greater Bay Area, Renminbi internationalization and other major development strategies, which are all important to “the Belt and Road Initiative”. As China has entered the final stage to realize its national goal as a global power, development is both the top priority and an abiding pursuit. As a result, it is crucial not only for Hong Kong’s survival but also provides an invaluable opportunity and an inexhaustible source of strengths and broad space for it to address prominent economic and livelihood issues that people are concerned with. To that end, the new Chief Executive Carrie Lam Cheng Yuet-ngor vowed that HKSAR takes all necessary measures to enforce the principle of “one country, two systems”.

Pragmatically speaking, as the Chinese Government Work Report in 2016 explicitly stated, Hong Kong and Macao are expected to play their roles in China’s economic development and especially in “the Belt and Road Initiative”. Thus, the framework agreement on closer cooperation between the Chinese mainland, Hong Kong and Macao aims to draw up a development plan for a city cluster in the Pearl River Delta that gives full play to the distinctive strengths of each side. Or simply put it, with relatively higher market sophistication, the advantage of “one country, two systems”, and competitiveness in building up clusters of production and industries, the economic aggregate of the Greater Bay Area in the Pearl River Delta is poised to exceed the bay area of Tokyo to become the world’s largest economic cluster area by 2025.

In closing, despite a growing sense of local identity and even a clear anti- Chinese sentiment among the post-1997 generation, most people in HK admit that in the next 20-30 years, thing are going to change. They have the bridges between Hong Kong, Macau and the cities in China, and they have high-speed rail as well. These infrastructures will change Hong Kong and eventually the borders will become seamless. As a result, “Hong Kong will integrate more in China, whether we like it or not.” These words were confided by a HK business magnate Allen Zeman. What he said is not exaggerated, yet he still missed the point, that is, the central government in Beijing allows no one to interfere with the Hong Kong’s business and to deviate from the official line of the principle of “one country, two systems”.

Wang Li is Professor of International Relations and Diplomacy at the School of International and Public Affairs, Jilin University China.

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East Asia

China’s soft power and its Lunar New Year’s Culture

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Authors: Liu Hui & Humprey A. Russell*

As a common practice, China has celebrated its annual Lunar new year since 1984 when the leaders of the day decided to open mysterious country in a more confident and transparent way. So far, the lunar new year gala has become a part of Chinese cultural life and beyond. The question then arises why China or its people have been so thrilled to exhibit themselves to the world, as its economy has already impressed the world by its rapid pace and tremendous capacity.

As it is well-known, in international relations, peoples from different cultural and ethnical backgrounds need to enhance their understanding which eventually leads to mutual respect and tolerance as the key to the world peace and stability. China is well-aware of this norm. As a rising power with 1.3 billion people, it is necessary for China to introduce its culture and notion of the peaceful rise to the audiences globally. Joseph Nye, Jr., the founder of the concept of the soft power, has argued: “The currency of soft power is culture, political values, and foreign policies. During the information age, credibility is the scarcest resource.”In light of this, China has been steadily involved in cultural promotions abroad.

China is an ancient civilization but diplomatically it is a new global player in terms of its modern involvement into the world affairs, particularly in terms of reform and openness. Yet, since China has aspired to rejuvenate itself as one of the leading powers globally, it is natural for the world en bloc to assume Beijing’s intention and approach to the power transition between the rising power like itself and the ruling powers such as the United States and the G-7 club. Consider this, China has exerted all efforts to project but not propagate its image to the world. Here culture is bound to play the vital role in convincing the countries concerned that “culturally China has no the gene of being a threat to other peoples,” as Chinese President Xi has assured. The annual lunar gala is evidently a useful instrument to demonstrate Chinese people, culture and policies as well.

Culturally speaking, the Chinese New Year celebrations can be seen as follows. In a general sense, similar themes run through all the galas with the local cultural and ethnical ingredients, for instance, Chinese opera, crosstalk and acrobatics, as well as the lion-dancing or the dragon-dancing from time to time. Yes, the galas play the role of promoting the Chinese communities over the world to identify themselves with the Chinese culture which surely strengthen the cultural bonds among the Chinese, in particular the younger generations. Moreover, the dimension of the Chinese culture can be found beyond the country since its neighbors like Japan, Vietnam, South Korea and Malaysia, as well as Chinese communities in many other areas also perform those arts at the holiday seasons. The message here is clear that China, although it is a rising great power, has never abandoned its cultural tradition which has emphasized the harmony among the different races and ethnics.

Recently, the lunar new year celebrations across China have invited professional and amateur artists from all over the world. Those foreign guest artists and many overseas students studying in China have been able to offer their talents in either Chinese or their mother tongues. No doubt, this is a two-way to learn from each other because Chinese performers are benefited from the contacts with their counterparts globally. In terms of public diplomacy, Beijing aims to send a powerful and sincere message to the world: China can’t be in isolation from the world because it has aspired to be a great and inclusive country as well. To that end, the rise of China is not going to challenge the status quo, but will act as one of the stakeholders.

As usual, realists have difficulties and even cultural bias to accept the rhetoric from a country like China since it has been regarded by the ruling powers of the world as an ambitious, assertive and communist-ruled country with its unique culture. To that challenge, the Chinese government and the people have done a great deal of works to successfully illustrate Chinese practice of harmony at the societal level idealized by Confucius’ doctrines. This social harmony is made possible only by the realization of the Taoist ideal of harmony with nature – in this case, harmony between humans and nature. This explains why panda and many other rare animals are now viewed as new national symbol of China. Although they are unnecessarily an indispensable part of the lunar new year gala, the viewpoint is that the rise of China would not be completed at the cost of the ecological environment like many other countries did in history.

Practically speaking, the lunar new year celebrations are being conducted in a rich variety of ways such as concerts, cuisines, folk entertainments and even forums and receptions around the world. Major global commercial centers have also served to create a Chinese holiday atmosphere, adapt to the needs of Chinese tourists, attract active participation from local residents, and provide such diversities of cultural and social events. What is worth mentioning is that some Chinese-North American non-profit, non-partisan organizations are beginning to celebrate Chinese lunar gala in partnership with other local counterparts. For instance, the Chinese Inter-cultural Association based in California, recently hosted a Chinese New Year party in a Persian restaurant in partnership with a local non-profit, non-partisan organization called the Orange County Toastmaster Club, part of Toastmaster International. Also, in another Chinese New Year celebration that was open to people of all races in Pasadena, two Americans played the guitar and sang songs in fluent Chinese! Both galas were attended by people of all racial backgrounds around the world. Given this, it is fair to say that China’s soft power supported by its annual lunar new year festival is on the rise globally with a view to promoting mutual respect and friendship among the peoples of various cultural, ethnical and racial origins.

Yet, though the impressive feats are achieved, it has noted that China still has a long way to go in terms of its twin-centennial dreams. First, as a developing country with its unique culture, it is necessary for China to promote its great ancient culture abroad, but it is also imperative to avoid “introducing” China rashly into the globe. Essentially, soft power is more the ability to attract and co-opt than to use force or give money as a means of persuasion. Thereby, it is the very ability to shape the preferences of others through appeal and attraction. As cross-cultural communication is a long process, Nye admitted a few years ago, in public affairs, “the best propaganda is not propaganda.”

This is the key to all the countries. In 2014,President Xi formally stated, “China should increase its soft power, give a good Chinese narrative, and better communicate its messages to the world.” In light of this, Chinese lunar new year gala surely acts as soft power to project the image of China internationally.

* Humprey A. Russell (Indonesia), PhD candidate in international affairs, SIPA, Jilin University.

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East Asia

China’s step into the maelstrom of the Middle East

Dr. James M. Dorsey

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The Middle East has a knack for sucking external powers into its conflicts. China’s ventures into the region have shown how difficult it is to maintain its principle of non-interference in the internal affairs of other states.

China’s abandonment of non-interference is manifested by its (largely ineffective) efforts to mediate conflicts in South Sudan, Syria and Afghanistan as well as between Israel and Palestine and even between Saudi Arabia and Iran. It is even more evident in China’s trashing of its vow not to establish foreign military bases, which became apparent when it established a naval base in Djibouti and when reports surfaced that it intends to use Pakistan’s deep sea port of Gwadar as a military facility.

This contradiction between China’s policy on the ground and its long-standing non-interventionist foreign policy principles means that Beijing often struggles to meet the expectations of Middle Eastern states. It also means that China risks tying itself up in political knots in countries such as Pakistan, which is home to the crown jewel of its Belt and Road Initiative — the China–Pakistan Economic Corridor (CPEC).

Middle Eastern autocrats have tried to embrace the Chinese model of economic liberalism coupled with tight political control. They see China’s declared principle of non-interference in the affairs of others for what it is: support for authoritarian rule. The principle of this policy is in effect the same as the decades-old US policy of opting for stability over democracy in the Middle East.

It is now a risky policy for the United States and China to engage in given the region’s post-Arab Spring history with brutal and often violent transitions. If anything, instead of having been ‘stabilised’ by US and Chinese policies, the region is still at the beginning of a transition process that could take up to a quarter of a century to resolve. There is no guarantee that autocrats will emerge as the winners.

China currently appears to have the upper hand against the United States for influence across the greater Middle East, but Chinese policies threaten to make that advantage short-term at best.

Belt and Road Initiative-related projects funded by China have proven to be a double-edged sword. Concerns are mounting in countries like Pakistan that massive Chinese investment could prove to be a debt trap similar to Sri Lanka’s experience.

Chinese back-peddling on several Pakistani infrastructure projects suggests that China is tweaking its approach to the US$50 billion China–Pakistan Economic Corridor. The Chinese rethink was sparked by political volatility caused by Pakistan’s self-serving politics and continued political violence — particularly in the Balochistan province, which is at the heart of CPEC.

China decided to redevelop its criteria for the funding of CPEC’s infrastructure projects in November 2017. This move seemingly amounted to an effort to enhance the Pakistani military’s stake in the country’s economy at a time when they were flexing their muscles in response to political volatility. The decision suggests that China is not averse to shaping the political environment of key countries in its own authoritarian mould.

Similarly, China has been willing to manipulate Pakistan against its adversaries for its own gain. China continues to shield Masoud Azhar (who is believed to have close ties to Pakistani intelligence agencies and military forces) from UN designation as a global terrorist. China does so while Pakistan cracks down on militants in response to a US suspension of aid and a UN Security Council monitoring visit.

Pakistan’s use of militants in its dispute with India over Kashmir serves China’s interest in keeping India off balance — a goal which Beijing sees as worthy despite the fact that Chinese personnel and assets have been the targets of a low-level insurgency in Balochistan. Saudi Arabia is also considering the use of Balochistan as a launching pad to destabilise Iran. By stirring ethnic unrest in Iran, Saudi Arabia will inevitably suck China into the Saudi–Iranian rivalry and sharpen its competition with the United States. Washington backs the Indian-supported port of Chabahar in Iran — a mere 70 kilometres from Gwadar.

China is discovering that it will prove impossible to avoid the pitfalls of the greater Middle East. This is despite the fact that US President Donald Trump and Saudi Arabia’s powerful Crown Prince Mohammad bin Salman seem singularly focussed on countering Iran and Islamic militants.

As it navigates the region’s numerous landmines, China is likely to find itself at odds with both the United States and Saudi Arabia. It will at least have a common interest in pursuing political stability at the expense of political change — however much this may violate its stated commitment to non-interference.

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East Asia

Chinese extradition request puts crackdown on Uyghurs in the spotlight

Dr. James M. Dorsey

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A Chinese demand for the extradition of 11 Uyghurs from Malaysia puts the spotlight on China’s roll-out of one of the world’s most intrusive surveillance systems, military moves to prevent Uyghur foreign fighters from returning to Xinjiang, and initial steps to export its security approach to countries like Pakistan.

The 11 were among 25 Uyghurs who escaped from a Thai detention centre in November through a hole in the wall, using blankets to climb to the ground.

The extradition request follows similar deportations of Uyghurs from Thailand and Egypt often with no due process and no immediate evidence that they were militants.

The escapees were among more than 200 Uighurs detained in Thailand in 2014. The Uyghurs claimed they were Turkish nationals and demanded that they be returned to Turkey. Thailand, despite international condemnation, forcibly extradited to China some 100 of the group in July 2015.

Tens of Uyghurs, who were unable to flee to Turkey in time, were detained in Egypt in July and are believed to have also been returned to China. Many of the Uyghurs were students at Al Azhar, one of the foremost institutions of Islamic learning.

China, increasingly concerned that Uyghurs fighters in Syria and Iraq will seek to return to Xinjiang or establish bases across the border in Afghanistan and Tajikistan in the wake of the territorial demise of the Islamic State, has brutally cracked down on the ethnic minority in its strategic north-western province, extended its long arm to the Uyghur Diaspora, and is mulling the establishment of its first land rather than naval foreign military base.

The crackdown appears, at least for now, to put a lid on intermittent attacks in Xinjiang itself. Chinese nationals have instead been targeted in Pakistan, the $50 billion plus crown jewel in China’s Belt and Road initiative that seeks to link Eurasia to the People’s Republic through infrastructure.

The attacks are believed to have been carried out by either Baloch nationalists or militants of the East Turkestan Independence Movement (ETIM), a Uighur separatist group that has aligned itself with the Islamic State.

Various other groups, including the Pakistani Taliban, Al Qaeda and the Islamic State have threatened to attack Chinese nationals in response to the alleged repression of Uyghurs in Xinjiang.

ETIM militants were believed to have been responsible for the bombing in August 2015 of Bangkok’s Erawan shrine that killed 20 people as retaliation for the forced repatriation of Uighurs a month earlier.

The Chinese embassy in Islamabad warned in December of possible attacks targeting “Chinese-invested organizations and Chinese citizens” in Pakistan

China’s ambassador, Yao Jing, advised the Pakistani interior ministry two months earlier that Abdul Wali, an alleged ETIM assassin, had entered the country and was likely to attack Chinese targets

China has refused to recognize ethnic aspirations of Uyghurs, a Turkic group, and approached it as a problem of Islamic militancy. Thousands of Uyghurs are believed to have joined militants in Syria, while hundreds or thousands more have sought to make their way through Southeast Asia to Turkey.

To counter ethnic and religious aspirations, China has introduced what must be the world’s most intrusive surveillance system using algorithms. Streets in Xinjiang’s cities and villages are pockmarked by cameras; police stations every 500 metres dot roads in major cities; public buildings resemble fortresses; and authorities use facial recognition and body scanners at highway checkpoints.

The government, in what has the makings of a re-education program, has opened boarding schools “for local children to spend their entire week in a Chinese-speaking environment, and then only going home to parents on the weekends,” according to China scholar David Brophy. Adult Uyghurs, who have stuck to their Turkic language, have been ordered to study Chinese at night schools.

Nightly television programs feature oath-swearing ceremonies,” in which participants pledge to root out “two-faced people,” the term used for Uyghur Communist Party members who are believed to be not fully devoted to Chinese policy.

The measures in Xinjiang go beyond an Orwellian citizen scoring system that is being introduced that scores a person’s political trustworthiness. The system would determine what benefits a citizen is entitled to, including access to credit, high speed internet service and fast-tracked visas for travel based on data garnered from social media and online shopping data as well as scanning of irises and content on mobile phones at random police checks.

Elements of the system are poised for export. A long-term Chinese plan for China’s investment in Pakistan, dubbed the China Pakistan Economic Corridor (CPEC), envisioned creating a system of monitoring and surveillance in Pakistani cities to ensure law and order.

The system envisions deployment of explosive detectors and scanners to “cover major roads, case-prone areas and crowded places…in urban areas to conduct real-time monitoring and 24-hour video recording.”

A national fibre optic backbone would be built for internet traffic as well as the terrestrial distribution of broadcast media. Pakistani media would cooperate with their Chinese counterparts in the “dissemination of Chinese culture.”

The plan described the backbone as a “cultural transmission carrier” that would serve to “further enhance mutual understanding between the two peoples and the traditional friendship between the two countries.”

The measures were designed to address the risks to CPEC that the plan identified as “Pakistani politics, such as competing parties, religion, tribes, terrorists, and Western intervention” as well as security. “The security situation is the worst in recent years,” the plan said.

At the same time, China, despite official denials, is building, according to Afghan security officials, a military base for the Afghan military that would give the People’s Republic a presence in Badakhshan, the remote panhandle of Afghanistan that borders China and Tajikistan.

Chinese military personnel have reportedly been in the mountainous Wakhan Corridor, a narrow strip of territory in north-eastern Afghanistan that extends to China and separates Tajikistan from Pakistan since March last year.

The importance China attributes to protecting itself against Uyghur militancy and extending its protective shield beyond its borders was reflected in the recent appointment as its ambassador to Afghanistan, Liu Jinsong, who was raised in Xinjiang and served as a director of the Belt and Road initiative’s $15 billion Silk Road Fund.

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