Hong Kong or King Kong

One of the best parts of our Round the World cruise is the Cunard Lecture Enrichment Programme, with a wide variety of speakers covering a myriad of subjects. One such speaker was Michael Hindley, a politician and current affairs speaker, whose topic was Relations between Europe and China, Past and Present: Competitive or Complimentary Interests.

One of his lectures was on Hong Kong and its role past and future. As our day in Hong Kong was very wet and rainy, we will summarize his lecture for you to enjoy and learn about Hong Kong and its relationship with China instead of our usual travel blog.  Special thanks to our “fourth sister,” Barbara Dempsey, for sharing her notes with us for this entry.

In the 1800’s, because it served as a strategic piece for its continued expansion of world trade, the British added Hong Kong as a colony to its empire. Britain held a 99-year lease on the island.  Subsequently, Britain helped Hong Kong develop its own government, currency, and financial structure.  The colony expanded its world commerce and was able to survive, independently, during the rise of the Communist regime on Mainland China.  It was vitally important to Britain to keep alive British interests in Hong Kong, even after turnover to Mainland China.  And they succeeded.

Mr. Hindley made the point of asking, “Will China take over Hong Kong or will Hong Kong take over China?”  This was a novel approach to the issue;  but, of course, China will take over Hong Kong, or will it?

In 1949, the Communist Party came into control, and as a result, people from Shanghai (the country’s major commercial center) left Mainland China for Hong Kong, bringing with them their entrepreneurial skills and money. By the 1980’s, Beijing wrote off Shanghai as being a hotbed of leftism and allowed the city to fall into decline.  Mainland China’s loss was Hong Kong’s gain.

For many years, China took the position that isolation was best for China, using its workforce as its largest asset.  However, under the effects of globalization, the value/power of labor has been reduced significantly due to the great technological advancements in the manufacturing processes.

In 1989, the demonstration at Tiananmen Square was a turning point against the political elite governing the Mainland.  The feeling was that if the people could not have a democracy, then they must give the people material items to make their lives easier.  The pressure for social welfare programs is also rising; however, today China does not provide unemployment benefits or old age pensions.  Also, with the one child per family limitation, they have created an inverted triangle: potentially one child supporting four grandparents.  The base is simply not present to support such a system.

In the last several years, however, Mainland China has emphasized the building of factories, skyscrapers, and the rebuilding of roads and ports etc.  When Carolyn and Mary Jane visited Shanghai in 2005, we marveled at the fact that huge cranes were ubiquitous.  We saw so many cranes, in fact, that we resolved to invest in Chinese cranes when we returned to the U.S.  Six years later, during this trip we have been surprised to see that the construction has been completed, beautiful buildings everywhere, lush landscaping, wide roads, and a huge new port facility.  But, where is the business and industry that China was trying to attract through this building process?  We have noticed that a large number of the fine looking buildings are not occupied.  Perhaps the Chinese used a Field of Dreams approach: build it and they will come. But, in the end, will they come?

Today, there are two systems within China, one that was set up by the British in the 1800s in terms of Hong Kong and the other, the Communist system for the rest of China.  Thus, for example, in Hong Kong the currency is the Hong Kong dollar, while the rest of China uses the Yuan.  The governments are vastly different.  The Hong Kong constitution guarantees free speech and no censorship of the press. Interestingly, a one-way border exists between Hong Kong and the rest of China with residents of Hong Kong able to move back and forth to the Mainland, but residents of the Mainland not being able to move freely back and forth to Hong Kong.

 


Many people believe that the West is investing heavily in China.  But according to Hindley, America is NOT investing in China.  Rather, it is the other way around; China has invested heavily in America and, in essence, is partially responsible for keeping our economy afloat because it is in China’s best interest to do so.

Again, accordingly to Hindley, 90% of the investments into China come from overseas Chinese, those who do not live in China.  They are the ones who are investing for they love their native China, but not the Communist Chinese government.  Therefore, these people are investing only in Hong Kong; they feel this is near enough due to the continuing issues over human rights and the lack of social welfare programs being available on the Mainland.

Hong Kong has the skills to help China expand its economy; however, Hong Kong wants to remain separate from China. China has given Hong Kong until 2047 to integrate its economy into China’s, but Hong Kong wants to remain separate and has to convince China to leave it on its own.

But on the flipside, Hong Kong needs Mainland China.  Hong Kong is out of land for future development on the island. They buy electricity and water from China as well as food and other resources. And these payments to China are made in hard currency, which China needs. So it would make no sense for China to alienate Hong Kong when China is benefiting from this trade relationship.

What happens now?  Does Hong Kong take over China or does “King Kong” China take over Hong Kong?  And then, will the same thing happen in Taiwan?

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2 Responses to “Hong Kong or King Kong”

  1. Thank you for that extremely interesting post. How fortunate you all are to have such expertise available to you for your various landfalls, but especially this one in Hong Kong and China. I read it to Deede because she is legally blind and can’t read it. If only Deedecould get a little bit of vision back I think she would want to take a cruise like this. I am loving it vicariously. Mil gracias!

  2. Barbara Greenstein March 27, 2011 at 11:21 am

    Interesting post re:Hong Kong and China. Andy and I were in Hong Kong when the official date was announced for the Brits turning Hong Kong over to China. There was a sense of doom everywhere and we were told that everyone was trying to get foreign passports to get out. Also visited a refugee camp by the airport where Vietnamese families were literally stacked in very small ‘cages.’ Also saw dead cats in the sewers along the streets, contrasted with the very fancy houses on the hills & the famous racetrack. Odd what you remember! Stayed @ the Mandarin Oriental near the Star Ferry. Great to get an update! Can’t believe you’ll be home soon! Barbara

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