What crackdown? Life in the Hong Kong ‘gulag’, 15 months on. A disappointment for Mike Pompeo.

Oct 15, 2021
hong kong street
(Image: Unsplash)

The predictions by many Western pundits of tyranny and repression under Hong Kong’s 2020 security laws have failed to materialise.

As of October 1, 15 months has passed since the enactment of the National Security Law (NSL) in Hong Kong. Back then the airwaves were filled with knee-jerk commentary from politicians in America, the UK, Europe, Australia and more condemning the enactment of the security laws, that were in reality no different from those in their own countries, and offering sanctuary for the hundreds of thousands if not millions of apparently terrified Hong Kongers.

At the same time headlines in the Western media were full of forecasts of the end of Hong Kong, of mass migration, a crashing stockmarket, a plummeting property market, a wipeout of the Hong Kong dollar peg, and massive outflows of capital. In short, the end of Hong Kong as we know it.

As a number of politicians and media likened HK to a gulag, it is interesting to take a look, 15 months on, to see just what has happened.

Let’s start by looking at financial metrics:

  • The Hong Kong dollar remains stable at about 7.75 to the $US, right in line with its historical peg. There have been no signs of capital flight and Kyle Bass’s highly leveraged bet against the $HK, due to expire on December 31, looks like a loser. Hong Kong’s financial reserves remain extremely robust with a current balance of $US491 billion ($AUD664 billion). No sign here of massive outflows of capital.
  • Residential property prices, always an indicator of Hong Kong’s wellbeing, continue to hit all-time highs. Move on, nothing to see here.
  • The HK stockmarket remains firmly in the world’s top five, and sits in third place worldwide for IPOs in the first half of 2021. In spite of all the negatives the HK market remains a favoured choice for IPOs.

Not a lot to see there, so how about some “softer metrics”.

  • There were multiple claims that the new NSL would result in mass arrests and removals of dissidents across the border. So far total arrests under this law are 165 (0.002 per cent of HK’s population) of which 96 have been charged. The first trial, of Tong Ying-Kit, who drove his motorcycle into a group of police while flying a large flag proclaiming “Liberate Hong Kong, Revolution of our Times” resulted in a six-year prison sentence to be served in a Hong Kong prison.
  • This is the end of “freedom of the press in HK” was a rallying cry by the critics. Yes, Apple Daily self-immolated after Jimmy Lai pushed it under the bus by demanding the early repayment of a $HK150 million ($AUD26 million) loan. (Apple Daily has been losing money for years, only surviving through Lai’s bankrolling it). While widely denounced as the end of freedom of the press this has not come to pass, for example Hong Kong Free Press always highly critical of the HK government and of Beijing remains fully functional as do a number of other such publications. Internet access is as free as ever, foreign news publications can be bought openly on the streets of Central District.
  • That social media would abandon HK was another claim, and indeed Tik Tok pulled the plug, but it remains an outlier, Facebook and others all remain fully accessible; no need for VPN’s as again widely forecast.

A big one was the offer by the UK to create a path to permanent residency for about 3 million eligible Hong Kongers. Not only was this widely forecast to result in millions fleeing Hong Kong to the UK, but not to be left out Australia, Canada and the US also dangled various similar schemes, All were no doubt hoping to attract the best and the brightest (and the wealthiest) of HK’s population to their shores. Things didn’t go as the UK had hoped. First of all the folks arriving at Heathrow did not represent the wealthy of Hong Kong, so the UK government had to stump up a £43 million ($AUD79.6 million) subsidy for help with housing, education and employment. Note the title: “destitution funding”. The UK soon realised that the system was being gamed, with mum and the kids moving to UK while dad remains in his job in HK. This has resulted in the UK government changing the rules (on October 6) to make it at an “everyone or no one” proposition.

Given Hong Kong’s very fluid population and also the effects of Covid it is hard to put an exact figure on the permanent outflow of HK residents, but anecdotal evidence so far points to around 60,000 applications made to the UK. Set against the media prognoses of July 2020 of a mass exodus from HK in the millions this figure of less than 1 per cent of HK’s population a reality check for such breathless sensationalism. Furthermore this number is backed up by the lack of big gaps in the HK school population, and there are actually stories of families returning from the UK and re-enrolling their children.

Of course some people will want to leave Hong Kong, for multiple reasons, no different that in any country and they are of course free to make such choices. But past evidence shows that for every one that leaves HK, there are two wanting to come.

In summing up this view of HK 15 months on from the NSL I would make the point that Hong Kong has always enjoyed an almost unique position of being the place where East met West.

HK is the place where one can dine in the Peninsula Hotel or sit on a stool in a Day Pai Dong, ride in a Rolls-Royce or a sampan, the list of contrasts is endless. Since 1997 Hong Kong has also been the place where Western politics and Eastern politics also met, or perhaps collided. Prior to 1997 HK was administered from the UK with virtually zero local politics. Chris Patten as the last governor (1992–97) set in motion a move to a more pluralistic form of government. Beijing sat on the sidelines for 23 years as HK politics became more and more radical, not making any moves (to the disappointment of the press who were hoping for a Pulitzer Prize picture of tanks rolling across the border) while domestic terrorists occupied major roadways for almost three months, trashed HK’s world-class mass transit railway, vandalised two universities and generally created mayhem.

And it is also worthwhile to recall that Martin Lee, known to many as the father of Hong Kong democracy, was widely reported as saying he expected to be arrested in July 1997 after the handover. No such thing happened and the said gentlemen was one of a number of anti-Beijing activists who went repeatedly to the US to meet with the likes of Mike Pompeo and Nancy Pelosi in 2019-20 to campaign for sanctions against the governments in Beijing and Hong Kong, before returning to HK and proceeding unmolested to his luxury apartment on Hong Kong Island. It is particularly poignant that the youngsters who drank the Kool-Aid dispensed by Lee and others are now paying the price, many serving well-justified prison sentences for rioting and other offences.

Looking further afield, on October 4, just a few days ago, Singapore passed its own Foreign Interference Law, similar and some would claim even more far-reaching than HK’s National Security Law. However, in a real-time expose of the hypocrisy of Western politicians and news media, this caused hardly a ripple. No bold headlines, no offers of expedited residency for “terrified Singaporeans fleeing tyranny”. Perhaps because it’s not an excuse to bash Beijing this news moves rapidly and seamlessly off the radar, if it ever makes it on in the first place.

One could fill a bookcase with weighty tomes on the end of Hong Kong, and like a broken clock they could of course be right at one particular time. Hong Kong is a story of glass half full glass half empty, of course there are those, including many in the media who choose to see the glass half empty and mourn the missing half. Fortunately there are many others who see the glass as half full with lots of opportunity to fill the other half.

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