Mark Pinkstone/Former Chief Information Officer of HK government
Morgan Stanley’s former Asian chairman Stephen Roach, who last year infamously forecasted the death of Hong Kong, has changed his tune and now says Hong Kong is the driving force behind China’s economy.
It is far from over and Roach says that if he had to rewrite a piece on Hong Kong it would be that Hong Kong is experiencing a revival because of its Chinese characteristics, not in spite of it.
The admission by Roach is commendable in that he has admitted the error of his ways. But Roach is a businessman and a financier, not a politician. The lawmakers in the hallowed halls of congress and the senate remain in denial that Hong Kong is progressively moving forward and is a world player in the global economy, despite its size. They remain defiant in acknowledging the fact that our legal system is the same as theirs with an added benefit of bringing in foreign judges to ensure fairness of trials. But they are politicians, so admitting the truth is not on their agenda.
Roach has had a rethink about what he said last year, spurred on by the rift between US President Donald Trump and China and the role played by Hong Kong in combatting Trump’s bullying tactics. The city’s emergence as a bulwark against hostile US actions is strengthening the outlook for Hong Kong.
But Roach, being a typical American, still has a dig at Hong Kong’s national security law, which is very similar to the state and federal security laws of the US.
The city is being caught in the middle of the US and China rivalry, says Roach and Beijing’s intervention in the shape of a national security law is undermining Hong Kong’s political autonomy. These two elements continue to be concerns, according to Roach, who said Hong Kong is “now in China’s orbit completely from an economic, administrative and legal point of view.”
He added that the US-China conflict was more of an opportunity for Hong Kong than a threat.
“Hong Kong’s financial success may be determined more by its ties to China, and the impact that US pressures have had on forcing something closer to a full-blown financial decoupling between the US and China,” said Roach. “Hong Kong is in a position to benefit from that.”
Whether or not there is a financial decoupling with the US in the near future remains to be seen. But Hong Kong has always benefitted from its position in China.
The economist also believes that the conflict between the US and China is getting worse. “And Hong Kong — rather than getting hammered in the crossfire as I expected and wrote — may be benefiting from that, because of its unique position as China’s most important window to international finance,” he told Bloomberg.
Bloomberg also noticed in its report that the Hang Seng Index has rallied 16 per cent, outpacing the S&P 500, in which has little has changed. Share listings have raised HK$77 billion ($9.9 billion) in Hong Kong this year through May, the most since 2021, led by Contemporary Amperex Technology Co. — better known as CATL – Roach’s original thesis for Hong Kong’s demise which he maintained throughout 2024.
In February last year, Roach wrote in the Financial Times that “Hong Kong is now over,” citing a sluggish stock market performance. He said “the wheels had come off” in 2019-20 when there were “massive pro-democracy demonstrations” against the proposed extradition bill and the introduction of the national security laws. He claimed that “the 50-year transition period to full takeover by the People’s Republic of China had been effectively cut in half.”
This, of course drew strong rebuttals from officials and politicians in Hong Kong and Beijing. But throughout the year Roach continued his rhetoric that Hong Kong was doomed.
It was the bullying tactics of Trump who changed his mind. First the trade sanctions, followed by sanctions on Hong Kong’s senior officials, then stripping Hong Kong of its special status that allowed it to be treated separately from China and then the scrapping of visas for students attending Harvard University.
Bloomberg noted that it’s not just in finance that Hong Kong may increase its edge. Policies by US President Donald Trump such as revoking visas for Chinese students and his assault on elite colleges such as Harvard may also drive human capital towards the city.
To which he responded, “Our loss is your gain,” he said of Hong Kong.
Mark Pinkstone
** 博客文章文責自負,不代表本公司立場 **
Mark Pinkstone/Former Chief Information Officer of HK government
The words of China’s Foreign Minister, Wang Yi were loud and clear. The results of Hong Kong becoming a Special Administrative Region of China came about after successful negotiations between two sovereign states.
During the signing ceremony for the Convention on the Establishment of the International Organization for Mediation (IOMed) to be headquartered in Hong Kong, Wang cited Hong Kong as a success story of the peaceful settlement for international disputes.
"The city enjoys exceptional advantages in international mediation," Wang said, citing for example, its affinity to the motherland and connection to the world, its enabling business environment, its highly developed legal system, and its strength in both common law and civil law.
And in the words of Hong Kong’s Chief Executive John Lee Ka-chiu, the IOMed will become the world's first intergovernmental international legal organisation dedicated to resolving international disputes through mediation.
“It also reflects our shared confidence in mediation as a peaceful means to maintain international peace and security, as stipulated in the Charter of the United Nations,” he said
Wang said the new organisation, as a "rising star", will grow together with Hong Kong as the Pearl of the Orient.
Indeed, Hong Kong is well positioned to be the headquarters of such an august body that parallels only with the United Nations, which had representatives attending the signing ceremony.
Also attending the ceremony were representatives from 60 countries and some 20 related organisations.
Moreover, the choice of Hong Kong as the headquarters of IOMed was endorsed from various world leaders attending the signing ceremony.
Minister for Foreign Affairs in Thailand, Surakiart Sathirathai said Hong Kong has the reputation, a very positive one, with a world-renowned legal infrastructure and judicial system. “Hong Kong has an international reputation for being the centre for various dispute resolutions and Hong Kong has an excellent personality with international reputation. I think Hong Kong, of course, is well positioned to host this headquarters of IOMed,” he said.
His words were echoed by the Deputy Prime Minister and Foreign Minister of Pakistan, Mohammad Ishaq Dar who said that the signing ceremony not only marked the beginning of a new era in international mediation and diplomacy, but also the birth of an important global institution to support the principles of multilateralism and mediation. “I must also commend the choice of Hong Kong as headquarters of the newly established organization as a ‘super connector’ and ‘super value-adder’ where East meets West. This dynamic city is well poised for this transformational journey,” he said.
Despite what the US administration and its western followers continually sprout poisonous rhetoric to decry Hong Kong, the city still reigns supreme as an international entity due to its rule of law and legal system as well as its infallible ability to get things done under the most trying circumstances. They are simply jealous of Hong Kong’s ability to achieve success where they fail to make any movements forward.
Hong Kong’s location in the centre of Asia and as the gateway to China makes it accessible to all major markets in the region. It is also home to some 1,400 foreign companies that have established their regional headquarters in Hong Kong as well as some 10,000 foreign companies have set up shop in Hong Kong. Its financial sector is second to none in the region.
Of course Hong Kong already offers expertise in the fields of mediation with the Hong Kong Mediation Centre (HKMC), established in 1999 as the first professional mediation organisation recognised as a charitable institution in Hong Kong. It has more than 1,000 members from various professional sectors and plays a leading role in the mediation industry. So, for more than 20 years, the centre has strived to promote the development of mediation through its diverse services, aiming to create a harmonious community. Apart from professional mediation services provision, its scope of services extends to areas such as professional training, professionalisation, public education and external collaboration.
According to this year's International Arbitration Survey, Hong Kong is the most preferred seat of arbitration in the Asia-Pacific region and shares second place globally with Singapore. Hong Kong’s economy also came first in "business legislation" and "international trade" in the World Competitiveness Yearbook. And in the latest Business Ready Report published by the World Bank Group, Hong Kong ranks eighth in "dispute resolution" among the 50 economies covered.
