Hong Kong’s Two-Faced Identity: Prosperity and Panic

Hong Kong’s Two-Faced Identity: Prosperity and Panic
Photo Credit: AP /TPG Images

What you need to know

Hong Kong faces yet another challenge in the coronavirus after eight months of protests. The city is trying to retain its status as a global financial center while people struggle to secure basic goods.

It’s almost absurd to imagine one of the world’s wealthiest cities experiencing widespread panic over shortages of toilet paper, but that’s the sad and ironic reality in Hong Kong now. Three men robbed a supermarket of hundreds of toilet paper rolls last week, a stark illustration of the city’s current state.

After eight months of ongoing protests, Hong Kong was rocked by the coronavirus outbreak starting in January. Hospital staff went on strike over five days to force the local government to close the border with mainland China. The public desperately bought facemasks, instant noodles, and toilet paper rolls, prompting a Bloomberg columnist to liken Hong Kong to a failed state

While Hong Kong is not quite a failed state yet, it is in dire straits. The problem goes beyond mainland Chinese interference or Chief Executive Carrie Lam’s ineptness: finance and commerce have been prioritized deliberately over other aspects of life, including public health and socio-economic policies. 

A_shop_assistant_restocks_boxes_of_masks
Photo Credit: Reuters /TPG Images
A shop assistant in Hong Kong restocks boxes of masks following the outbreak of the novel coronavirus.

This has led to Hong Kong’s questionable status as both a gleaming global financial center and a declining city that cannot even guarantee security and basic goods for its people. 

Hong Kong has long boasted an image as a top financial hub, with soaring skyscrapers, streets brimming with bankers, and business-friendly rules. The government always prides itself on topping the global lists as one of the “freest” and “most competitive” economies. Last year, despite the anti-government protests, Hong Kong was crowned the world’s top IPO center.

The anti-extradition movement, however, showed the depth of anger and desperation among many Hong Kong youngsters. While political demands drove the protests, socio-economic despair played a huge factor, with young people claiming a willingness to face jail or even death because they had no hopes and nothing to lose. With a poverty rate of almost 20 percent, gaping inequality, and the world’s highest home prices, Hong Kong has failed to provide much for its people.

Economic prosperity brought complacency

Between 2004 and 2019, Hong Kong saw multi-billion-dollar budget surpluses every year as its reserves swelled to over HK$1 trillion (US$130 billion). 

John Tsang, who served as finance secretary from 2007-2017, took a lot of pride in accumulating these annual surpluses, claiming that it was needed as an emergency buffer while overseeing minimal spending on social programs and public housing. He didn’t think the city’s growing inequality, high poverty rate, and skyrocketing housing prices constituted any vital reason for government spending.

A few years ago, I heard a major local property developer CEO boasting that Hongkongers do not need handouts when asked about whether the government should boost social support programs, an attitude that clearly indicates the mindset of Hong Kong elites towards the working class and poor.

One of my relatives, a mid-level civil servant in Hong Kong, sneered at Taipei’s lack of tall buildings and its relative open sidewalks during a visit, contrasting them to Hong Kong’s dense streets. His holier-than-thou attitude is not unusual among some Hongkongers, which helps to explain why the city remains full of cramped apartments.  

Hong Kong has always existed as a business entrepot from its early days in the 19th century to the present. The city’s continued prosperity after the 1997 handover fostered a strong sense of arrogance and complacency among its political and economic leaders, ensuring that little would be done to improve the domestic living conditions. Major projects such as the delayed West Kowloon Cultural District and Cyberport turned out to be white elephants, adding no value to the city and its residents.

Fumbled epidemic prevention

The current panic over the coronavirus further accentuates the city’s lacklustre leadership. From delaying the closing of Hong Kong’s borders with China to dithering and ever-changing messages, Lam has sent Hongkongers into a state of panic and distress. 

The panic buying of toilet paper arose out of rumors that supplies imported from China would be held up at the border. Hongkongers, who have lost trust in their government’s abilities, went on a shopping binge to round up toilet paper rolls, dry foods, and hand sanitizers.

Hong_Kong_Chief_Executive_Carrie_Lam_wea
Photo Credit: Reuters /TPG Images
Hong Kong Chief Executive Carrie Lam wears a mask as she arrives to a news conference.

Worse is her inability to set up a face mask rationing system or implement price control. In contrast, countries like Singapore and Taiwan have handed out or subsidized face masks for their citizens, while even tiny Macau adopted early measures such as putting a daily cap on face masks to prevent hoarding.

At one point, Hong Kong authorities shot down rumors that they would be giving away face masks, giving the impression they had no plans to alleviate the situation at all. This attitude is not uncommon in Hong Kong, with Lam being a prime example as a leader who never seems sympathetic to the people. 

Thousands of Hongkongers are now stuck in Hubei province, the epicenter of the outbreak, but the Lam administration’s only reaction is to claim it would be too difficult to evacuate them instead of figuring out practical solutions. 

A city controlled by tycoons

Only half of the 70 Hong Kong legislators are elected by the public, the rest are elected by functional constituencies, which represent “substantial” sectors including finance and real estate. Hong Kong’s chief executive is elected in a similar, unrepresentative way by an “Election Committee” with 1,200 members, in which a quarter of them are key figures from big businesses.  In other words, the tycoons and corporations have a strong influence on the legislative direction of the city, as well as the choosing of its leader.

To amplify Hong Kong’s near-sighted prioritization of commerce, Beijing’s tight grip over the city only worsens its outlook. China still needs the financial hub’s established instruments, including a trusted legal system and freedom of information to attract global businesses. As a top offshore yuan clearing center and with Chinese firms like Alibaba, Xiaomi, and Tencent listing on its stock market, Hong Kong is expected to retain its financial importance. 

For the Beijing leaders and Hong Kong tycoons, the city is merely a financial hub for profit maximization, not an actual place with over 7 million residents. 


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TNL Editor: Jeremy Van der Haegen (@thenewslensintl)

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