[SCMP Column] Confidence Crisis

April 02, 2016

Over the past 20 years, I have given over 600 presentations to business groups in Hong Kong and around the world on Hong Kong’s future after 1997. Both in the deeply paranoid run-up to 1997, and the couple of years after, that involved staring in the eye deeply skeptical audiences and assuring them unblinkingly that Hong Kong was going to be OK.

Many of these groups were concerned about the economy, and others about democracy and human rights. But all were concerned about the rule of law, and whether the common law principles that underpinned business confidence in Hong Kong would be respected by Hong Kong’s new sovereigns in Beijing.

In absolutely every briefing, I have been able to say with confidence that Beijing’s track record in respecting the internationally binding undertakings in the 1984 Sino-British Joint Declaration, and the Basic Law undertakings on Hong Kong people ruling Hong Kong, has been unblemished. I have been able to recall the ridiculous CNBC 1997 handover news footage portraying Chinese troops flowing over the border into the Tamar garrison, and say with confidence that this said more about the paranoid prejudices of some in the international media than it did about the reality of China’s intentions towards Hong Kong.

That was until now.
Unhappily, the antics surrounding Lee Bo and his four publishing colleagues between October last year and their “sort of” release over the past week, have cast a serious cloud over the confidence and certainties held until now. The confidence of international businesses active across Hong Kong’s many business chambers has been shaken.

Maybe China’s various responsible agencies feel pleased with themselves for keeping the lid on what could have become an explosive international human rights controversy. But they should be in no doubt that the events of the past five months have seriously rattled business confidence.

We may perhaps never discover the exact details of what occurred. Whether Mainland security services, or people acting on their behalves, physically spirited the publisher and his colleagues across into the Mainland, or whether they were prevailed upon to walk across the border voluntarily (and secretly), we may never know. But the fog around these events, and the protracted failure to clear the fog, has spoken volumes.

Certain things we seem to know. Senior leaders in Beijing called for a crackdown on “misguided” publishers and publishing houses both inside and outside China, but were unspecific (at least for us outsiders)  on what form this crackdown should take. Beijing’s security sensitivities over the activity of such publishers have been heightened, no matter how marginal and inconsequential we outside China regard the activities of such people.

Hong Kong’s own law enforcement and security services were clearly unaware of what had happened until after Lee Bo’s “disappearance” at the end of December. And even now they have been unable to explain how these men could have been spirited into China to help China’s security services with their inquiries without any record being left of their departure from Hong Kong. At the very minimum this is embarrassing for our security services, and raises questions about their authority over law enforcement in the SAR.
Access to the five men – in particular the two that held Swedish and British passports – over the five months during which they have been “assisting” Chinese authorities has been extremely limited, even to embassy diplomats who protested, and sought access to them. Even the expressions of concern from the Hong Kong government have attracted cursory responses that have done nothing to disperse the fog.
And while the fog remains, many in Hong Kong and internationally will wonder at the possibility of Mainland security personnel – or people acting on their behalves – entering and operating in Hong Kong unbeknownst to Hong Kong’s own security enforcement personnel. It is this that has thrown a chill over the local and international business communities, who until now had assumed that “Hong Kong people ruling Hong Kong” meant that our Hong Kong police and security services were the only people empowered to investigate possibly criminal activity within Hong Kong’s boundaries.

In contrast with this confusing incident, Beijing’s actions in Hong Kong have until now been impeccably correct. The Chinese army has stayed firmly inside the garrison, leaving Hong Kong police to handle uncomfortable events like Occupy Central, or the Mongkok riots. Beijing’s requests for cooperation in seeking out, and returning, Chinese business people or officials who are suspected of corrupt activity – an important element of the ongoing anti-corruption campaign – have been managed with proper due process. So perhaps the Lee Bo mess was the result of some unapproved overzealous overreach on the part of local security personnel in Guangdong. If that was so, would it not be wonderful if Beijing officials could have the confidence and modesty to say as much? Clearing the fog would do much to restore badly damaged business confidence.

Of course, there will be many officials who believe this will all blow over and be forgotten. True, it will probably blow over. But no, it will not be forgotten. From the signing of the Sino-British Joint Declaration in 1984 to October last year – more than 30 years – Beijing can say without fear of contradiction that it has always punctiliously respected the commitments made in the Joint Declaration, and later in the Basic Law. That is no longer true. A rubicon has been crossed. Even if Beijing never admits as much, one has to hope that the concerns expressed among Hong Kong people, by Hong Kong’s still-feisty media, by the Hong Kong and international business community, and by the Hong Kong Government itself, prompt Beijing officials to think twice in future about allowing anyone to act in ways that undermine confidence in the autonomies guaranteed in the Joint Declaration and the Basic Law.
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