Speeches and Articles by U.S. Consul General James B. Cunningham

Hong Kong at 10 Years: Prospects for the Future

James B. Cunningham
Consul General of the United States of America
Center for East Asian Studies
Stanford University
November 12, 2007

(As prepared for delivery)

It is a great pleasure to be here today, and I thank the Hoover Institution and Professor Ming Chan for the invitation to speak on prospects for Hong Kong's future.

As a resident of Hong Kong for only a little more than two years, I feel a bit reticent about forecasting Hong Kong's future – especially in such experienced company. But, as I had occasion to recall last summer in a speech to the Better Hong Kong Foundation, 10 years ago observers far more knowledgeable than I were warning of Hong Kong's imminent demise.

Happily, they were quite far off in their predictions. As I looked in that speech at Hong Kong over the past decade, my review was quite upbeat.

I want to take as my starting point today the reaction to that earlier speech.

I noted in June that in contrast to the universal concern over Hong Kong's future just before the city's return to China in 1997, and despite such large problems as the Asian financial crisis and SARS, Hong Kong has not only survived, but prospered. Looking back over the last ten years, "one country, two systems" has been a success for Hong Kong and for China. The Basic Law's commitment to preserve a "high degree of autonomy" for Hong Kong and to maintain the integrity of its distinct economic, legal and social systems, by and large has been observed.

At the same time, I noted some areas where things might have gone better for Hong Kong, notably in the area of developing responsive governance that is rooted in free and fair democratic elections. I also observed there are concerns in some quarters about the preservation of the high degree of autonomy promised in Hong Kong's Basic Law and the 1984 Sino-British Joint Declaration. These are prompted by a widely-held perception that Hong Kong's press increasingly practices self-censorship, and by several instances over the years where intervention or interpretation by the Central Government have raised questions in Hong Kong and the international community about Hong Kong's autonomy and competitiveness.

So how was this generally favorable evaluation received?

Xinhua news service in English reported on the speech pretty fairly, saying that it was generally positive but raised some points of criticism. It quoted from all sections of the speech. The Chinese language Xinhua wire service story, however, deleted all references to passages even slightly critical of the central Chinese government's approach to Hong Kong. Central-government-friendly papers in Hong Kong, like Ta Kung Pao and Wen Wei Po, covered the speech as an unqualified endorsement of the success of China's "One Country, two Systems" approach. The more pro-democracy and English-language media generally highlighted the critical elements while noting the positive.

But two of the more important elements of the speech, to my mind, were largely missed by most media reports, regardless of their editorial slant:

• I stated unequivocally that a prosperous, stable and confident China is in the U.S. national interest,
• I said that my government wants Hong Kong and the "one country, two systems" model to succeed.

And I tried to make the point that these two things are linked. That linkage, I think, points the way to the future.

We Americans are optimistic about Hong Kong's prospects. The city maintains the core values that we believe contribute to success in the globalized world of the 21st century. Hong Kong remains a model Chinese society that is committed to the rule of law, maintains free markets, is open to entrepreneurs, and respects freedom and human rights, including religious freedom. Its political system is evolving and public participation in civic affairs is growing. And international surveys of the world's economies consistently place Hong Kong in the top ranks.

There is no reason to believe that Hong Kong's success in the last 10 years won't continue in the next ten. Hong Kong is the most open and developed part of China. The Central Government has generally respected its commitment to Hong Kong's high degree of autonomy and has acted over the years in concrete ways to support Hong Kong's economic development and prosperity. Hong Kong continues to strengthen its role as an international financial center. It is strengthening its focus on its human capital and competitiveness. Increasingly it will serve as an avenue for mainland capital moving into new markets abroad.

But as in the stock market, past results are not a guarantee of future success. Hong Kong faces the difficult issues that all modern societies grapple with: Economic, political and demographic. And with an economy that is based on services, logistics and tourism, it will face stiff competition to maintain its value-added.

In a rapidly changing global economy, maintaining the status quo is not enough. Success will go to those who are able continually to adapt to new circumstances, and to place themselves on what a mentor of mine used to describe as "the right side of history."

The pace of change is accelerating, challenging all developed societies and in many cases developing ones as well. Tony Blair in a speech in Hong Kong last week used the term "permanent modernization" to describe this phenomenon of change as a constant factor of life. This is quite new, and all of us and our children will have to learn to deal with it.

Hong Kong over the past years has proved its adaptability. When we look at Hong Kong's prospects, the question becomes whether it is capable and willing to continue to adapt and evolve.

This brings us inevitably to the political issues that confront Hong Kong. In the fast-moving globalized economy of the 21st century, good governance is a necessary condition for success. Difficult decisions need to be taken and executed. Our experience is that a vibrant, authentic political process strengthens leadership legitimacy and accountability, and thus promotes stability. Indeed, in our view such political legitimacy and accountability are core components of modern, competitive and stable societies. Over time, good governance and stability without democracy are illusory.

Because of this, my government has long supported universal suffrage in Hong Kong, as promised in the Basic Law. We believe it necessary, for both Hong Kong and the Mainland, that Hong Kong set out on the path toward governance strengthened by popular elections within a democratic system that meets international standards. The sooner this happens, the better.

My government does not support any particular electoral model, timetable for reform, or candidate. We welcome the Chief Executive's intention to resolve the issue of universal suffrage during his term of office, and would hope to see genuine dialogue and early reform that will sustain Hong Kong's prosperity, stability and good governance.

We also believe that greater democracy, now in Hong Kong and over time in the rest of China, will support China's peaceful development. There is no one way to build democracy, and it will be more difficult on the mainland than in Hong Kong. But building democracy will contribute to Hong Kong's enduring stability and prosperity, and that is of value to China itself, and this region of the world.

There are of course two elections coming up, one for District Councils, and one for the Legco seat left vacant by the untimely passing of DAB leader Ma Lik. The Legco campaign in particular is drawing considerable international attention due to the two leading candidates.

In some respects, over the past few weeks some elements have tried to make the United States a factor in the campaigns. Several pro-central government newspapers and magazines started publishing commentaries in mid-October that Hong Kong was being subverted by a supposed plot by foreign forces to interfere in Hong Kong affairs. Some attempted to undercut political opponents by charging they are in collusion with foreign forces.

Normally I would not even address this type of commentary. But there is a point here germane to the forecast you've asked me to make and I offer these comments in that context.

Such allegations have no basis in fact, specifically in regards to the United States. Our activities in Hong Kong are the normal diplomatic activities that all countries, including the PRC, engage in around the world. Of concern however is the mindset and intent behind these allegations. They betray a xenophobia out of place in Asia's World City. Were such thinking to take hold, it would be a bad omen for Hong Kong's future. Substituting fabricated conspiracies and the politics of identity for discussion of substance is no way ahead.

We in the U.S. understand this—heaven knows we are tempted and seduced by this kind of politics from time to time ourselves—but generally we have recognized its destructive character.

Such talk is detrimental to healthy political life, especially in a place like Hong Kong. Hong Kong has created itself as a mixing bowl, an entrepot, a place where China meets the world. The very engagement of foreigners in Hong Kong has always been one of the defining elements of this special part of China.

That said, we remain optimistic about Hong Kong's prospects. With its open, vibrant and sophisticated society, it has much to contribute to China and the rest of the world as an international city. People in Hong Kong are working to prepare for the future and to plan for change. One country, two systems is working, and I have no doubt it can continue to do so.

Let me close with a vision, rather than a forecast. The United States has a bright vision for Hong Kong's future. We see a Hong Kong that is part of a prosperous, stable and confident China, and which contributes to its country and the world by continuing to be a leading light in economic freedoms, civil liberties and respect for human rights. We see a Hong Kong whose people are proudly Chinese, who love their country and who pursue Hong Kong's own development even as they help build China. We see a Hong Kong that continues to prosper and adapt to change, and whose government has found the stronger legitimacy that comes from popular elections. We envision a Hong Kong that draws strength from its Chinese heritage as well as its Western heritage, a Hong Kong that is a positive, dynamic force in China's development.

That is the prospect for Hong Kong my country would like to see.

*     *     *     *     *