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

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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

U.S.- China Strategic Competition in The East Asia

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East Asia has been the most dynamic region where development has been internationally recognized. The regional politics of the region has developed a paradox that has flamed up the economic environment of the region. The trends have shown the increased intensifying security issues along with the strategic completion that has spread the security and economic tensions across the East Asian Region. In a global circle, China is known as the revisionist state. The historical manners suggest the reclaim of East Asia by the Chinese. This claim has intensified the relations between the US and China in East Asian Region.  The main challenge for China is to shift the US intervention from the East Asian region for the balanced equation at the strategic level. This might provoke the US and its allies in East Asia such as Japan that will help the US to jeopardize the Chinese rule from the region. The challenge for the US and its allies in the East Asian Region is more complicated because of the economic stability of China at the International Level. This might be a proxy war for both the superpowers in the East Asian region where the conflict may rise compromising the strategic stability of the region. The strategic location of the US lies in the actual form of ability and project power over great sustainable intervals. The strategic behavior increases the policies and shapes the allies.

One prevalent belief in the United States about China’s long-term policy goals in Asia is that Beijing aspires to be the regional hegemon and wants to restore a Sino-centric order in the region.

First, Beijing favors unipolar ties at both the global and regional levels and believes that with ongoing economic growth, this trend will continue intra-regional political consultation in Asia, influence on regional affairs is going to be more diversified and more evenly distributed. Secondly, although China expects some relative increase in its influence in Asia, it understands that thanks to the boundaries of its hard power and particularly its soft power, China can never achieve a grip cherish its role within the ancient past or to the U.S. role within the region at the present.

Beijing’s perspective:

From Beijing’s perspective, the US is an East Asia power, although not an Asian power, and its political, economic, and security interests within the region are deep-rooted, as are its commitments to regional stability and prosperity. Beijing has always welcomed a constructive U.S. role in regional affairs. At the identical time, however, Beijing also feels uneasy with certain aspects of U.S. policy. As a superpower, The US has been too dominant and intrusive in managing regional affairs. It fails to pay due regard to the voices of other regional players and sometimes gets too involved within the internal affairs of other states, lacking an understanding of their culture, history, and values.

The US and European aspects towards the South China Sea and East Asia should involve long-term perspectives of engaging ASEAN states. Such impacts will create room for the US to tackle China in the East Asian region. The development of any comprehensive strategic security policy is the need of the hour that assures one’s interest in the region. Both the states perceive a threat from each other and try to further advance their capabilities for the sake of safety and security. The US is not in a position to deal with the other power far away from its homeland, sustaining its military and protecting allies. Aggressive behavior in strategic competition can lead to unwanted results. The US would have to accept the strategic realities of China to normalize the relations. China on the other hand should rethink its policies in East Asia and Indo Pacific. However, as yet, deterrence has played its part by keeping states from a large-scale action. States running in the race of acquiring arms conventionally due to uprising strategic competitions are worsening any likely condition of conflict.

Key points for US:

In terms of identifying specific actions for a U.S. strategy for competing strategically with China in East Asia, a key element would be to possess a transparent understanding of which actions are intended to support which U.S. goals, and to take care of an alignment of actions with policy goals. Cost-imposing actions are actions intended to impose political/reputational, institutional, economic, or other costs on China for conducting certain activities within the East Asian Region, with the aim of persuading China to prevent or reverse those activities. Such cost-imposing actions need not be limited to the East Asian Region only. 

Conclusion:

The development of any comprehensive strategic security policy is the need of the hour that should involve joint military maritime exercises. The US and China have set their limits in coordinating military to military joint cooperation due to their desired interests and competition. Both the states perceive a threat from each other and try to further advance their capabilities for the sake of safety and security.  

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East Asia

Summit for Democracy Attempts to Turn Multicolor Modern World into Black and White Divisions

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One of the most important takeaways from the recent sixth plenary session of 19th CPC Central Committee is that Beijing flatly rejects Westernization as the path to modernize the Chinese society and the national economy. Instead, as it was underscored in the plenary Communiqué, the country will continue to stick to “socialism with Chinese characteristics in the new era.” The leadership will preserve and further develop the system that served the people so well over last more than 70 years.

This statement did not come as a surprise to numerous China watchers all over the world. In fact, the critical choice between socialism and Western-type liberalism was not made in November of 2021, but decades ago.

One can argue that the outcomes of the sixth plenary session are yet another manifestation of a more general global trend: The world has been and will continue to be very diverse in terms of political systems, social models and economic patterns of individual nation states. Moreover, the odds are that this diversity will increase further literally in front of our eyes. Instead of the “end of history,” we will observe more intense multifaceted competition between different types of social development.

One way to react to this emerging reality is to accept it as a positive trend that enhances the overall stability of the global social system. The more diverse and complex the system is, the more resistant it is to various shocks and disturbances. To make a rough analogy with biology, a natural forest, which is a very diverse and complex ecosystem, is much more resistant to whims of the weather and natural disasters than a man-cultivated monocultural field. Accepting the trend, we should focus on how to manage competition within the increasingly diverse and complex world so that this competition will ultimately benefit all of us.

The other way to deal with this reality would be to start fighting against social, political and economic diversity by trying to advance one single model over all others. This is exactly what the Joe Biden administration is committed to doing by launching an ideological crusade against China, Russia and other nations that dare to deviate from the fundamentals of the Western development model. To make its case, the White House has announced a virtual Summit for Democracy to be hosted by the US on December 9–10 with the goal “to renew democracy at home and confront autocracies abroad.”

This vision reduces the multi-color palette of the modern world to a minimalist black and white graphics of a global fight between “democracies” and “autocracies.” It divides the international system into “us” and “them,” into “good” and “bad,” into “legitimate” and “illegitimate.” Such a reductionist system, if constructed, cannot be stable and shock-resistant by definition: Any major international crisis or a regional conflict could spark high risks of implosion.

It goes without saying that the nations of the world should firmly oppose corruption, abuses of power by state authorities and gross violations of human rights. If the goal of the Summit for Democracy were to confront these evils on a global scale, there would be no need to make the event exclusive by inviting mostly US friends and allies. If the goal is to advertise the US political, social and economic model, Washington should probably delay the summit and put its house in order first. If the goal is to isolate Beijing and Moscow in the world of politics, this is not likely to work well for the US.

Nations of the world have a right and even a duty to experiment with their political and social development paths. This experimenting contributes to the overall social experience of the humankind. Only history is in a position to judge what models turn out to be efficient, productive and fair and what models will find their place at the dump of human delusions. And history has a lot of means at its disposal to punish leaders, who believe that they possess a “one size fits all” model, which could successfully replace the existing diversity with an imposed universalism.

From our partner RIAC

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The Chinese diplomatic force in the IAEA to confront Western leadership

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At the level of international relations, through China’s presence in all the relevant international organizations, and its membership in all of the United Nations organizations, specifically in the International Atomic Energy Agency “IAEA”, China aims to play the role of the (international balancer),  in light of its quest to maintain a certain level of competition with the United States of America politically and economically, this is in line with its desires to constantly play the role of the pole calling for (multipolarity and multilateral international pluralism through the Chinese political speeches of Chinese President “Xi Jinping”), in order to oppose American hegemony over the world and Washington’s policies to maintain its position as a single pole in the international community. China’s increase in its foreign investments, in order to enhance its economic hegemony over the world through its political and diplomatic tools with countries that have equal economic power with it in a number of (trade, scientific and technological issues, in addition to military and intelligence tools, as a reference for China’s new foreign political center).

  We note that the patterns of Chinese foreign policy is (the pattern of dependence, which is based on the high level of foreign participation in all current global issues), to restrict the attempts of the United States of America to pass its decisions internationally, and therefore China is trying to enter the membership of all international organizations so that China’s foreign policies remain more comprehensive, broader and more effective in the global change, and to change all directions of these issues and control them in the United States, and this is one of its new political tools that serve its global expansion through the (Chinese Belt and Road Initiative).

   In the same context, China focuses its external and competitive strength on its presence in effective international organizations, and rapprochement with the European Union, especially (France, Germany), despite not denying their relations with Washington, because of their strong influence in the global economy.  In addition to China’s reliance on the plan of foreign and foreign investments in countries that influence American influence through the Belt and Road projects, as well as China’s resort to the import policy of many resources necessary to develop its economic capabilities from certain European countries to open influential relations with them, leading to (the Chinese strategy to obtain  political support through the policies of alliances, consulates, representations, and its membership of international organizations), with the aim of influencing countries’ policies economically to pass important international decisions regarding the US challenge to China, such as: (the Iranian nuclear file, North Korea, Myanmar, Afghanistan, Syria, Venezuela, etc.), to increase with this  The level of external penetration of China economically and politically).

    China is mainly aiming to increase its membership in international organizations and the International Atomic Energy Agency, to (create a new balance of power and get rid of unipolarity restrictions through the medium powers and small states that the international system prevails with real pluralism, instead of the current state of American unipolarity).

   In my personal opinion, the countries of the Middle East may find in the rise of China and Russia, and perhaps other international powers to re-compete the United States,  as a (real opportunity to advance the effects of the pluralism of the international system at the regional level, and this would create more space for movement and opposition or bargaining and flexibility of movement for all to confront the policies of American hegemony, according to Chinese planning with Russia), and this also works to alleviate those restrictions and American dictates, and perhaps the sanctions and pressures it imposes on opponents of its approach internationally.

  The strategy of competition between China and the United States has become China’s long-term strategy, which is based on (the necessity of a heavy Chinese presence in all international organizations and forums, which allows China to communicate with various global powers and balance its relations with them compared to Washington), as well as diversifying the People’s Republic of China for its relations and distribution of its power among the competing countries, which allows China to show wide options on all important issues, and the most dangerous is that this Chinese presence, which (allows Beijing to prejudice the foundations of its relationship with the United States of America and the other various powers around the world).

  China and Russia also aim to form an alliance into all international and regional organizations to change the current provocative approach of the American policies in their confrontation, especially those related to mobilization policies and American alliances against them around the world. The Chinese alliance with Russia was so clear with the (Russian Foreign Minister “Sergey Lavrov’s visit” to Saudi Arabia, the UAE and Qatar, while on the other hand, both Kuwait and Qatar have received a member of the Political Bureau of the CPC Central Committee and Director of the Office of the Foreign Affairs Committee of the CPC Central Committee “Yang Jiechi”).

    On the other hand, China is among the Security Council countries that have the largest number of (Chinese peacekeeping forces around the world), and China is at the forefront of the (most contributing countries to the international peacekeeping budget, in addition to sending naval fleets to carry out maritime guard missions according to according to the UN Security Council resolutions), and therefore China may play an important role in establishing security in many countries in the world, and this is perhaps what China plans to ensure its use, in the event of a decline in American interest in the security of many regions in the world, within the framework of (the strategy of pressure of the American expenditures, retreat and withdrawal from many places around the world and devote its concern to the American interior issues and its worsening economic crises).

  The point is worthy to be considered here, is the report issued in July 2021 by the (International Atomic Energy Agency), entitled “Nuclear reactors around the world”, in which he analyzed China’s plan to (establish the dream of nuclear sovereignty around the world by starting to build and establish about 11 reactors). There are other Chinese nuclear reactors under construction, as well as the (new Chinese planning to build other 29 nuclear reactors), while the International Atomic Energy Agency’s work report on the other hand indicated that the known total number of reactors that are actually in service, other than those planned for construction, and other reactors under construction, is up to  About 50 Chinese nuclear reactors, a step that confirms that “China is clearly shifting towards nuclear energy in the production of electricity, and depends on it directly in its industrial renaissance during the coming period, especially as it is the number one country in the world that is expanding in the establishment of nuclear plants, followed by Russia, which plans to build other 20 new nuclear reactors, while it has 38 nuclear reactors in active service”. Some leaks indicate the presence of Chinese nuclear reactors, exercises and tests in the “Doklam Desert” region on the borders of “Xinjiang” province in northwest China.

   It also notes that, from the reality of the report issued by the International Atomic Energy Agency “IAEA”, its confirmation regarding (Chinese planning to become the first country in the world in the production of nuclear energy during the next ten years, in return for the decline in the share of the United States of America in nuclear reactors, which continues to the continuous decrease with the exit of new American numbers of reactors annually), as the future plan of the United States of America does not include the establishment of new reactors, which indicates that (the expansion of this type of energy tends towards China and Russia during the coming period, and these countries will have accumulated experiences, enabling them to dominate and control this new nuclear industry in various countries of the world, and this is what is actually common happening in the region).  Knowing that its uses will be mainly peaceful and to serve the interests of peoples and countries, so we may witness the coming period intensifying the role of the International Atomic Energy Agency in many files around the world to study them, inspect different regions and various other areas to ensure (their peaceful uses of nuclear energy in many development projects around the world).

   Hence, we almost understand (the importance of the Chinese presence and presence and its membership in the International Atomic Energy Agency in the first place), given that it actually owns 50 nuclear reactors in service, and its contribution to the production of electricity and providing energy to one and a half billion citizens, and China also has new nuclear reactors under construction, so (China seeks to be near the International Atomic Energy Agency, to embarrass, restrict and limit the American influence on the one hand against Beijing’s allies, led by Iran and then North Korea. Therefore, China has developed a strategic plan in the coming years, which is based on the intensity of the Chinese international presence and passing its foreign policies and decisions with the help of its Russian ally internationally).

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