The Western media has often declared "Hong Kong is dead," much like the "China collapse” theory. However, Hong Kong remains resilient, while those who predicted its downfall have faded away. Similarly, China has not collapsed, and foreign governments that anticipated its downfall are collapsing faster.
In 1995, two years before Hong Kong's handover, Fortune magazine published an article by its Asian correspondent, Louis Kraar, claiming that post-1997, Hong Kong's future would be bleak. The cover declared "The Death of Hong Kong", predicting Beijing's control over the Hong Kong government, the replacement of English language with Mandarin, and the People's Liberation Army “which has already formed links with the powerful local criminal gangs known as ‘triads’ strolling the streets, foreign businesses leaving because of unfair treatments, and Hong Kong dollar de-linked with US dollars. This dire prediction ignited global attention.
Twelve years later, in 2007, Fortune's sister publication, Time magazine, refuted this conclusion. In a 25-page report marking the 10th anniversary of Hong Kong's handover, Time acknowledged that Fortune had "badly and wrongly predicted" Hong Kong's demise. The article noted, "Hong Kong is more vibrant than ever."
Unfortunately, Louis Kraar passed away in 2006 at the age of 71, and thus did not witness Hong Kong's repeated recoveries from adversity.
Recently, Hong Kong has experienced a series of pleasant events, including the historic winning of two Olympic gold medals and the birth of twin pandas to Ying Ying at the age equivalent to 57 human years. Some attribute Hong Kong's success to good fortune, but there are deeper factors at play.
Geographical Advantage: Located at the edge of the Pearl River Estuary, Hong Kong has a natural deep-water harbor. It’s position also makes it an aviation hub and a crucial place for exchange and interaction between China and the West.
Take a look around the world, all dynamic cities are built on critical locations by the sea. With our Motherland functions as our hinterland, we have become the hub that connects the world.
A Strong System: "One country, two systems" is the key to Hong Kong's long-term success. The country has seen the rise of mega cities like Beijing, Shanghai, Guangzhou, and Shenzhen, with population size and economic scale larger than that of Hong Kong. Hong Kong has no way to compete with those big guys if we are under the same system. However, the “two systems” sets us apart and Hong Kong can now maintains its advantage and fulfill its special role as a bridge to the outside world.
But of course we cannot just count on “two systems” and ignore the “one country” factor. Hong Kong has survived political turmoil only because of the stabilizing force demonstrated by the Central Government at critical moments.
Hong Kong's Spirit: Ultimately, Hong Kong's success relies on its people and its “Can do” spirit. Despite limited resources, Hong Kong's population is hardworking and resilient, believing that even a small place like Hong Kong can achieve extraordinary success.
Chief Executive John Lee recently repeated the remarks made by some visionary investors that those who bet against Hong Kong's long-term prospects will ultimately lose. Although we must not lose sight of the current challenges including the impact of U.S. interest rate hikes and the less-than-exciting business atmosphere, history shows that Hong Kong repeatedly overcomes difficulties. Therefore, betting against Hong Kong is unwise.
Wing-hung Lo
Bastille Commentary
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