Some events look like accidents. But savor the political implications, and you realize they are anything but simple.
Recently, a terrifying refugee wave hit Spain. The epicenter: Ceuta, a Spanish enclave on the North African coast.
Spain sits at Europe's southwestern tip. Ceuta, by contrast, is at the northernmost edge of the Maghreb, a Spanish autonomous city that borders Morocco.
On July 30, a massive wave of illegal immigrants swam into Ceuta. Some media put the number at 49,000 in just 24 hours, mostly Moroccans.
Videos of the chaos surfaced online. Some edited the footage to look like a zombie invasion. Trump's close friend Musk reposted one, calling it a joke. But the schadenfreude was unmistakable.
Later, the vast majority were deported back to Morocco. But the incident left at least 67 migrants dead.
Their bodies were pulled from the sea, deflated floats drifting nearby. Most drowned.
This refugee storm was ostensibly triggered by rumors.
The immediate spark: a misinterpreted ruling by the Spanish Supreme Court in early July. The court said illegal immigrants arriving by sea in Ceuta could not be immediately deported. But that was just a procedural provision. It did not mean they could obtain legal status.
The decision was quickly twisted into explosive rumors. Some claimed that simply swimming into Ceuta guaranteed the right to stay in Spain and eventually gain legal status. Others insisted that Spain had opened its borders.
By last week, Instagram and other platforms were flooded with videos and photos of migrants successfully crossing. The images spurred a wave of copycats.
A 16-year-old Moroccan who entered illegally said he took the risk after seeing those very videos on Instagram. It was later confirmed that many of the images were old photos passed off as real, or even AI-generated fakes. Paired with misleading text, they were disguised as footage of successful smuggling into Ceuta. They incited a flood of illegal immigrants to swim into the territory.
The vast majority of the illegal immigrants who stormed the border were Moroccans. Morocco's economic situation is dire: youth unemployment sits at 37%, and 25% of young people are trapped in a triple bind of no education, no employment, and no poverty alleviation. They reacted fiercely to the false messages swirling online, convinced that swimming ashore would grant them residency in Spain.
In the end, the Spanish government quickly brought the situation under control and returned those who had entered illegally to Morocco.
But the incident triggered a major political shock. Far-right Italian Prime Minister Meloni was the first to attack. Her Brothers of Italy party quickly posted footage of illegal immigrants running through the streets of Ceuta, along with a mocking caption: "This is the Sánchez model the Italian left wing likes so much."
Meloni then announced that she would suspend the Schengen Agreement, which allows free movement of people between Italy and Spain, citing security threats.
Italy's move infuriated Spanish Prime Minister Sánchez. The Socialist leader lashed out at some EU countries for attacking Spain during the crisis, playing political calculations instead of providing support.
From Spain's perspective, the influx of refugees had already been brought under control. Ceuta itself is not part of the Schengen Area; its residents were never able to move freely within the EU under the Schengen Agreement. Moroccan illegal immigrants could never have traveled to the European mainland without checks. Italy's action was simply making an issue out of nothing.
The real question: was the surge of illegal immigration in Ceuta an accident, or was it orchestrated behind the scenes? Western far-right forces look like the prime suspects.
Meloni was the first to be questioned. Even the BBC reported that she was simply exploiting the situation, and she knew it very well.
As the BBC notes, Meloni faces elections next year. Her ruling coalition is bleeding support, under fire from a fierce new anti-immigration party.
This was her moment to project strength and claw back votes. She seized it immediately.
Spain has been angering its Western allies. And it's not just its relatively lenient attitude toward immigration.
Prime Minister Sánchez has long maintained friendly relations with China, putting him outside the EU mainstream.
Then there's his flat refusal to hike military spending to 5% of GDP, as Trump demands. That makes him a maverick among EU heavyweights, and it has infuriated Trump.
Back on July 8, Trump met with NATO Secretary General Rutte. He didn't mince words: Spain was hopeless. The US wanted no business with Spain.
He wanted to cut off all trade, even official visits.
After the refugee surge in Ceuta, Trump gleefully weighed in. He described the scenes “looks like an invasion”. He said it was terrible, told people to remember the picture, and warned that “that same thing's going to happen to us if the Republicans don't get elected, except worse, much bigger”.
Trump directly linked the Spain incident to the US election. Highly suspicious.
The geopolitical situation is extremely tense. Spain just got hit by a sudden refugee surge. Most of the migrants have been sent back, but Sánchez is deeply wounded. This may have been premeditated.
The real attack on Spain isn't the refugee wave. It's the far-right forces led by Trump.
Lo Wing-hung
Bastille Commentary
** 博客文章文責自負,不代表本公司立場 **
The highest form of political struggle is not an election. It is not even war. It is ideological struggle.
I have recently been reading the comments on Hong Kong by Stephen Roach, former chairman of Morgan Stanley Asia. Roach says Hong Kong has become just another Chinese Mainland city. His remarks carry the unmistakable flavor of ideological struggle.
Roach is not really focused on finance or economics. He is focused on politics, treating the National Security Law as the watershed between Hong Kong’s success and failure. He seems to have forgotten that the United States has far more national-security laws than Hong Kong, with around 20 in the United States and only two in Hong Kong.
What makes Roach’s remarks strange is his constant swing from one position to another. Two and a half years ago, he advanced the “Hong Kong is finished” theory. A year ago, he said “too early to declare Hong Kong over.” Now he says once again that “the Hong Kong of old is, indeed, over.”
For such an experienced financial professional to swing so wildly, there are two possible explanations.
The first is stupidity. His analysis may not be deep enough, leaving him easily swayed by surface appearances.
The second is malice. The forces behind Roach may be far from simple. Those forces may keep pushing him to make bearish remarks, leaving his statements adrift between his own views and the pressure behind the scenes.
China’s central leaders have said that the world is undergoing “profound changes unseen in a century.” Behind that phrase lies the rise of the East and the decline of the West. Put plainly, it describes the struggle between China and the United States.
Roach’s comments are part of that ideological struggle. Hong Kong practices “one country, two systems.” It is a capitalist international city within the framework of one country, and it serves an important role for the nation.
To deny Hong Kong’s status as an international financial center is to break one of the country’s arms, a crucial strategy to weaken China.
The precision of Roach’s moves, and those of the forces behind him, lies in targeting the heart of the issue. They seek to shape people’s thinking. Roach’s remarks have three layers of negative impact.
First, they deny Hong Kong stocks’ key selling point.
Hong Kong’s stock market has been transforming for more than two years. With strong support from the central government, a large number of exceptionally high-quality Chinese Mainland companies have listed in Hong Kong.
Global giants such as CATL, which holds a dominant position in strategically important industries and has chosen to establish a presence in Hong Kong.
For international investors bullish on CATL, Hong Kong is the most convenient place to buy its shares.
The listing of first-rate Chinese Mainland companies in Hong Kong has directly lifted market turnover. Average daily turnover has climbed from about HK$90 billion three years ago to around HK$300 billion today.
Hong Kong has become an international stock market with unique access to the Chinese Mainland’s best listed-company resources. London and Singapore may covet this China-specific advantage, but they cannot obtain it.
Yet Roach turns the story upside down. He portrays the listing of high-quality Chinese Mainland giants in Hong Kong as a negative Mainland factor. He turns Hong Kong stocks’ strength into a weakness.
This is like performing surgery on people’s thinking at its most fundamental level. If Hong Kong people accept this narrative, and officials become constrained by Roach’s thinking, they may eventually feel embarrassed to say that so many Chinese companies are listing in Hong Kong. That would be exactly what the “Roaches” want.
Second, his remarks intimidate capital away from Hong Kong.
Roach’s article is mainly about politics, not finance. He drags the National Security Law into the discussion and cites criticism of Hong Kong’s rule of law from former non-permanent judges of the Hong Kong Court of Final Appeal who are hostile to China.
But the reality is that there is no sign that the National Security Law has affected investors’ ability to buy stocks in Hong Kong.
Since 2018, the U.S. government has openly and quietly urged funds not to buy Chinese stocks. Anti-China lawmakers have even written directly to university investment funds, questioning why they buy Chinese shares listed in Hong Kong.
As time passed and China-U.S. relations eased somewhat, that sense of fear had begun to fade. But Roach is now reviving the issue. In effect, he is refreshing foreign funds’ memories and intimidating them against investing in Hong Kong.
Third, this thinking hijacks the minds of Hong Kong officials.
In my observation, many Hong Kong elites, including financial officials, genuinely love their country and sincerely hope for national prosperity and strength. But they are also highly vulnerable to being hijacked by ideas like Roach’s.
They often believe Hong Kong must return to its old self and restore close ties with the United States and Britain. They believe the SAR government should say less about the National Security Law, while financial officials should intervene less in the market and allow U.S. capital to take the lead. In their view, that is the true meaning of “one country, two systems.”
Frankly, this view ignores the reality that the United States seeks to suppress China. It is somewhat outdated. The issue is not whether Hong Kong wants better relations with the United States, but how much the other side wants better relations with Hong Kong.
On July 17, President Xi Jinping attended the World Artificial Intelligence Conference in Shanghai. He said that “AI development is not a solo performance by one country, but a symphony for the whole world,” and called for openness and win-win cooperation.
At almost the same time, China’s Kimi K3 large AI model topped global rankings. Huawei unveiled its massive Atlas 950 SuperPoD supernode, which combines 8,192 Huawei Ascend 950 AI accelerator cards. That far exceeds rival Nvidia’s supernode, which can combine only 144 chips.
Yet as China’s AI development made major breakthroughs, Chinese AI and chip stocks listed in Hong Kong plunged. Whether that was coincidence or deliberate is unknown.
There is ideological struggle in the financial world, too. Hong Kong’s response is simple: do not let Roach’s thinking hijack us. We must step outside his ideological framework.
Do not judge finance through politics. Do not believe that a stock market with many China-related factors cannot be a good market. We should return to capitalist thinking and recognize that a market with rising turnover is a good market, not only one tilted toward the United States.
Hong Kong’s financial officials should return to capitalist principles and build a strong stock market. Their work should focus on three main areas.
First, do not be afraid to talk up Hong Kong stocks.
When the forward price-to-earnings ratio of Hong Kong stocks is less than half that of U.S. equities, why should Hong Kong not compare the two markets and speak positively about its own stocks?
Second, do not be afraid to buy more Hong Kong stocks.
Do not chase U.S. stocks simply because they are rising. Recognize the value of Hong Kong stocks and support Hong Kong at the same time. If even the Hong Kong Government does not increase its holdings of Hong Kong stocks, how can it ask others to buy them?
Third, do not be afraid to work harder to attract Chinese Mainland capital into Hong Kong stocks.
Do not assume this is merely self-evident. Chinese Mainland capital must be actively won over. Central financial and economic ministries and commissions have many responsibilities: they must maintain the renminbi exchange rate and keep A-shares performing well.
Fundamentally, they do not want too much capital to flow out.
On July 20, China Securities Regulatory Commission Chairman Wu Qing met face-to-face with eight representatives of retail investors of different sizes. He emphasized that retail investors are the foundation of the market. This was indeed an innovation, and it also shows how difficult it is to maintain the healthy development of the A-share market.
If Hong Kong financial officials do not make a strong effort to compete for Chinese Mainland capital, the Mainland may genuinely have little capacity to spare for Hong Kong.
The conclusion is clear: we need to think in reverse. Whatever Roach tells us not to do, that is what we should do.
Lo Wing-hung
