You can tell yourself stories all day about Hong Kong staying “neutral” in the brawl between China and America. Wishful thinking. The US never lets anyone sit on the fence for long, and PCCW’s showdown proves it.
When Uncle Sam wants answers, he gets them—FCC style. On October 15, the US Federal Communications Commission lit the fuse on PCCW’s Hong Kong Telecommunications, hinting it’s about to yank their American license. They fired off a letter, demanding Hong Kong Telecommunications justify why it shouldn’t be shut down. The big hang-up? Alleged connections to China Unicom, a company branded by Washington as “Chinese Communist Party–controlled,” with national security risk stamped all over it.
No middle ground: The FCC in its letter claims that “Hong Kong Telecommunications belongs to a Chinese Communist Party entity.” China Unicom Americas made the security risk list in 2022 and got the boot from the US for the exact same reason.
PCCW’s American dream faces the chopping block: Right now, Hong Kong Telecommunications makes international calls and connects networks in the US. It’s a subsidiary of PCCW, controlled by Richard Li, son of Hong Kong heavyweight Li Ka-shing. China Unicom owns just 18% of PCCW—and PCCW holds 52% of Hong Kong Telecommunications. Here’s the kicker: the FCC says Hong Kong Telecommunications is “owned by” China Unicom Americas, even though 18% barely counts as an associated company (the US bar is at least 20%). America simply calls affiliation when it wants.
Rules Rewrite the Game
Washington’s latest trick springs from a fresh rule dropped by the US Department of Commerce’s Bureau of Industry and Security (BIS) on September 29. Dubbed the “penetrating rule,” it’s tailor-made for tightening screws on China.
The basics are brutal:
50% Ownership Rule: If a sanctioned outfit holds 50% or more of another company, it drags that company onto the blacklist too—whether or not it’s named.
Red Flag Warning: If you’re exporting and suspect the other side is a controlled affiliate, but don’t know the shareholding, you have to dig deep—run checks, apply for BIS approval, or confirm any license exceptions.
Beijing knows a sledgehammer when it sees one. The new US rule lets sanctions ripple down to cover stacks of subsidiaries and “affiliates.” In no time, the Dutch government swipes Wingtech’s Nexperia assets, freezing its chips and IP for a year. That’s a straight up block and grab of Chinese property.
The Financial Times calls the Dutch move a direct “Washington follow”—the Wall Street Journal quotes Wingtech execs: The Dutch used the American rule as their fig leaf for asset seizure.
America’s Penetrating Push Spreads
Frozen assets in the Netherlands, licenses yanked in the US—it’s all part of the same September 29 playbook. The rules keep stretching. Forget the 50% threshold. China Unicom only owns 18% of PCCW, yet suddenly, PCCW is deemed a Chinese affiliate. Washington’s logic? Whatever suits their moment.
The burden’s on everyone else now. The US wants foreign companies to do the detective work before partnering with any Chinese entity. Fail to ID a sanctioned Chinese controller, and you’re in the crosshairs too. Nobody wants to touch business with China for fear of Washington’s penalties.
Double Standards Laid Bare
Two lessons jump out.
First: America’s double standards are shameful and as sharp as ever.
China responded to the US “penetrating rule” by setting its own export controls on rare earths. Any product sold abroad containing Chinese rare earths—report it to Beijing, keep it away from military buyers the government forbids.
Trump claimed he was “shocked” at China’s “hostile moves”—CNN and the New York Times had a field day. America has long choked exports of semiconductors to China, then escalated with September’s rule. China’s just treating Washington with its own medicine.
The second lesson: Hong Kong people need a wake-up call.
Some still believe they’re “international citizens,” not bound to China. But in Washington’s game, every Hong Kong company—whether owned by the Chan, Lee, Cheung, or Wong families—is Chinese.
When America goes after China, Hong Kong gets caught in the crossfire. This PCCW case makes it clear: In this fierce fight, there’s no “neutral zone” for Hong Kong people. Stand up. Stand with your country.
Lo Wing-hung
Bastille Commentary
** 博客文章文責自負,不代表本公司立場 **
Sixty-one years ago, on October 16, 1964, China detonated its first atomic bomb at Lop Nur in Xinjiang. The shockwave rippled far beyond the desert test site.
Suddenly, the PRC had joined an exclusive club—the fifth nuclear power after the US, USSR, Britain, and France. What made this achievement even more remarkable was the context: just five years earlier, in June 1959, the Soviets had pulled the plug on their assistance, walking away mid-project. China finished the job alone, calling it the "596 Project" to commemorate that moment of betrayal turned determination.
That first bomb test, followed by the successful test of a nuclear-armed missile in 1966 and the launch of the Dongfanghong-1 satellite in 1970, became immortalized as China's "Two Bombs, One Satellite" achievement. But back in 1963, when the project was still racing toward completion, not everyone was convinced it was worth it.
On December 18, 1963, Vice Premier and Foreign Minister Chen Yi faced Japanese journalists in Beijing and delivered what would become a controversial line. Responding to mockery about China's poverty, he declared: "The imperialists, revisionists, and reactionaries have atomic bombs and nuclear weapons—are they so remarkable? They bully us like this, they mock our poverty, saying we can't afford it. Even if I have to pawn my pants, I will still build nuclear weapons".
Marshal Chen Yi's words were meant to rally Chinese resolve during the final stretch. But when that quote reached Hong Kong, it landed badly with Louis Cha, the owner of Ming Pao newspaper.
The Great Pants Debate
Just twelve days later, on October 30, 1963, Cha published a scathing editorial titled "We Want Pants, Not Nuclear Weapons." His argument was blunt: he expressed outrage that a Chinese Communist leader would suggest sacrificing the people's basic necessities for nuclear weapons, arguing that any government placing military power before people's livelihood was fundamentally flawed.
Cha continued his assault, questioning whether Chen Yi understood that a country whose people lacked basic clothing could never become strong even with atomic bombs, and that such a government would never be stable. His clincher was particularly cutting—he pointed to Britain's nuclear arsenal during the 1956 Suez Crisis, noting that when the Soviets threatened to bomb London, the British still withdrew. Cha dismissed China's nuclear ambitions, arguing that even with another decade of effort, the country could never match Britain's nuclear achievements at the time of the Suez Crisis. He concluded sarcastically that a few pocket-sized atomic bombs would be useless, and that the people would be better served by having more pants to wear.
The editorial sparked a war of words that lasted over a year. Patriotic newspapers fired back vigorously, and Cha kept writing rebuttals. Looking back, this wasn't purely about current affairs commentary—there was a commercial calculation at play. Ming Pao had only launched in 1959 and needed to build its readership. Nobody reads bland consensus opinions. Since most Hong Kong people at the time leaned patriotic, Cha took the contrarian position. The resulting firestorm helped Ming Pao establish its reputation for provocative commentary.
History's Verdict
The passage of time has a way of settling arguments that seemed heated at the moment. Fast forward sixty-one years, and we can now reach a relatively objective verdict on the "nuclear weapons versus pants" debate.
First reality check: Without nuclear weapons, pants become utterly useless. Cha dismissed China's "pocket-sized atomic bombs" as pointless. But returning to the historical moment—1949, New China was established but was still in the "recovering" phase of national independence.
China was also facing enemies on all sides. The US remained hostile after being fought to a stalemate in Korea and was itching for revenge. Meanwhile, the Sino-Soviet split meant that the USSR—a bordering superpower with massive military strength—posed an enormous threat. Caught between the two military superpowers, nuclear weapons became China's essential insurance policy.
Decades later, Libya serves as a perfect cautionary tale. Gaddafi's regime clashed with the United States and vigorously pursued nuclear weapons. However, eventually he settled for a private negotiation with Washington, agreeing to halt nuclear development in exchange for America backing off. But when the Arab Spring erupted years later, CIA-backed anti-government forces overthrew Gaddafi in 2011. He died in a gutter. Dead men don't need pants.
That so-called democratic movement didn't bring peace to Libya. Fourteen years later, the country remains trapped in a devastating civil war, as two opposing governments split the country apart. Yet the world has already looked away—even the news stopped reporting. Such is the consequence of Libya's nuclear abandonment.
No Nukes, No Development
Second reality check: Without nuclear weapons, economic development itself becomes impossible.
Consider Japan. The Japanese economy flourished spectacularly in the 1980s, but in 1985, under American coercion, Tokyo signed the Plaza Accord in New York. Japan committed to substantial yen appreciation and reduced competitiveness against American goods. Result? Forty years of economic decline.
Why did Japan accept such a humiliating and unequal economic treaty? Simple—as a defeated WWII nation, Japan not only cannot possess nuclear weapons but also has its military development controlled by the United States, with massive US troop deployments throughout the country.
When a nation lacks military independence, it has no choice but to sign whatever agreements others demand. Without nuclear weapons, even economic development is held in others' hands.
Third reality check: You can have both nuclear weapons AND pants. Cha fundamentally underestimated China back then, assuming the Communist Party would only blindly expand its military without understanding economic development. He confidently asserted that even with continued effort, the CCP certainly could not match Britain's nuclear achievements.
Sixty-one years later, that prediction looks absurd. China's military power far exceeds Britain's, and economically, China has left Britain in the dust. China has emerged as a new great power, possessing not only formidable military strength but also economic volume that—measured by actual production quantities using purchasing power parity—surpassed the United States in 2014. Under CCP leadership, China not only possesses nuclear weapons but has also clothed Chinese people in pants and allowed them to live comfortable lives with adequate food and clothing.
Today, sixty-one years after that desert test in Xinjiang, looking back at China's atomic bomb achievement, we recognize this as a genuine milestone in China's development. China's possession of "Two Bombs, One Satellite" elevated it into the ranks of military powers, enabling it to protect its national security and create the essential conditions for economic development.
The bombs came first. Prosperity followed. That's not an accident—it's cause and effect.
Lo Wing-hung
