Some experts and scholars in the West and Hong Kong have made downbeat comments about Hong Kong’s economic prospects in recent months. They have attracted close attention from the central government, the Chinese mainland, and all walks of life in Hong Kong, especially since the city is currently having to cope with weak economic development, falling asset prices, the waning competitiveness of its traditional industries, nascent industries that are struggling to find their feet, and a difficult financial situation.

Some people tend to interpret those comments as conspiracy theories, believing that they are sinister political ploys used by internal and external hostile forces to harm China and the Hong Kong Special Administrative Region by encouraging companies, capital and talent to withdraw from the mainland and Hong Kong, thereby disrupting the city’s political and social stability, weakening its economic value to the country, and turning it into a pawn to endanger national security.

Stephen Roach, former chairman of Morgan Stanley Asia, wrote an article titled It Pains Me to Say Hong Kong Is Over, which was published in the Financial Times on Feb 12. Roach’s view, which is representative of many doomsayers, has aroused quite a bit of controversy. The reason is that Roach has long been regarded as an optimist about the economic prospects of China and the HKSAR. That he suddenly took a pessimistic attitude surprised many people. Roach posits that Hong Kong lost its high degree of autonomy after Beijing enacted and implemented the National Security Law for Hong Kong (NSL), that China’s economy has been sluggish due to major structural problems, and that the rivalry between China and the United States has spurred many of Hong Kong’s trading partners in Asia to side with the latter, to the detriment of the city. 

Since the promulgation of the NSL, the US and the West have intensified their campaign to harm Hong Kong, including spreading slanderous remarks that tarnish Hong Kong’s international reputation, trying to scare capital and talent away from Hong Kong with scaremongering tactics, and constantly threatening to sanction Hong Kong; the apparent intention is to compress Hong Kong’s international political and economic space, thereby further diminishing the city’s value to China

Arguably, lurking behind these pessimistic views of Hong Kong’s economic prospects is non-recognition of and pessimism about Hong Kong’s new development strategy. Those who hold these views believe that Hong Kong will collapse after deviating from its past development path, which was pro-West and embraced many Western features. However, changing the development strategy in Hong Kong is not a random act but the most rational, appropriate and logical strategic choice under the new international, national and local conditions.

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Since the beginning of the 21st century, the US has drastically changed its policy toward China, transitioning from dialogue and cooperation to containment and confrontation. The US and the West no longer hope that Hong Kong can become a base of subversion and promote China’s peaceful evolution. Instead, it has become an accomplice in facilitating China’s rise. 

Since then, the US and the West have become more and more immersed in Hong Kong affairs and, together with Hong Kong’s anti-China insurrectionists, have worked to undermine the city’s governance and stability, culminating eventually in large-scale riots in 2019-20. With the powerful internal and external hostile forces running amok, Hong Kong alone could not reverse the chaotic situation. 

Had the central government failed to come forward and enact the NSL, Hong Kong’s governance and stability would have collapsed, and “one country, two systems” would have become unsustainable. The NSL is an inevitable measure to ensure that Hong Kong can maintain prosperity, stability and development, and adhere to “one country, two systems”. In fact, from beginning to end, under “one country, two systems”, Hong Kong has only been a special administrative region of China. The central government, not Hong Kong, is the “first responsible person” for safeguarding national security. The central government is ultimately constitutionally responsible for protecting national security and maintaining Hong Kong’s high degree of autonomy. Accordingly, it cannot be said that Hong Kong has lost its high degree of autonomy after the central government enacted the NSL. On the contrary, Hong Kong’s high degree of autonomy has been consolidated since the city can no longer be used to threaten national security, and “one country, two systems” will be able to operate smoothly far into the future.

However, the US and the West loathe the NSL inordinately because the law, especially its extraterritorial effect, makes it difficult for external forces to instigate a “color revolution” in Hong Kong or turn the city into a base of subversion again. 

Since the promulgation of the NSL, the US and the West have intensified their campaign to harm Hong Kong, including spreading slanderous remarks that tarnish Hong Kong’s international reputation, trying to scare capital and talent away from Hong Kong with scaremongering tactics, and constantly threatening to sanction Hong Kong; the apparent intention is to compress Hong Kong’s international political and economic space, thereby further diminishing the city’s value to China. 

It would be even more to their liking if the city became China’s liability and Achilles heel. However, the US and the West have been unable to coerce Hong Kong’s neighboring economic and trading partners into reducing or cutting off economic and trade ties with Hong Kong. 

The city’s trading partners have shown no signs of preparing to do so. They are unwilling to favor one side over the other to retain their strategic autonomy and safeguard their interests. As an important international financial, trade and shipping center and an essential gateway into the Chinese mainland, the interests of the city’s economic and trade partners are difficult to disentangle from those of Hong Kong. Their interests, on the contrary, are becoming increasingly close. Hong Kong’s trading partners support its application to join the Regional Comprehensive Economic Partnership, attesting to their determination to maintain close economic and trade relations with the city. Therefore, the worry that Hong Kong will lose its economic and trade partners in Asia is, if not alarmist, unfounded.

Hong Kong has never intended to weaken its financial, economic and trade relations with the US and the West. Despite the containment and onslaught from the US and the West, Hong Kong still hopes to maintain or strengthen these relations as far as possible. However, these relations will inevitably be eroded under the hostility of the US and the West. More importantly, the US and the West have a weak economic situation. Even so, they continue to practice trade, financial and technological protectionism, and populism and anti-globalization waves are rising there. Even if the US and the West stop harassing Hong Kong, the market space and development opportunities they can furnish Hong Kong with will become increasingly limited. It is thus difficult for Hong Kong to continue to rely on the US and the West as the cornerstone of its economic development strategy as it did in the past. It must vigorously explore new and broader development space and create new impetus for growth. The importance of the mainland and the non-Western world to Hong Kong’s long-term development is self-evident.

There are numerous positive factors favoring China’s new development strategy. It is too early to judge the prospects for both the country and its HKSAR. On the contrary, I am sure that the so-called experts who speak ill of the country and its HKSAR will eventually become a laughingstock again, like their counterparts in the past. They are so sure of themselves right now because they still stubbornly believe that the development model of the West is a one-size-fits-all model

In recent years, more and more political leaders, HKSAR government officials, business and social leaders, and even the public in Hong Kong have had a more robust and concrete consensus on the need to open new development space, and the urgency of doing so has increased. The HKSAR government and people from all walks of life in Hong Kong are determined to participate in constructing the Guangdong-Hong Kong-Macao Greater Bay Area and use this as a pivot to accelerate the city’s integration into overall national development. They also actively promote Hong Kong’s economic and trade relations with Middle East and Southeast Asian countries, opening a broader market for Hong Kong’s finance, shipping, trade and professional services. These emerging markets will inject new development impetus into Hong Kong, thereby making up for the diminishing development opportunities from the US and the West.

To strengthen Hong Kong’s development momentum, the HKSAR government is gradually jettisoning the outdated thinking that has long hampered the government’s economic functions, especially the “positive nonintervention” or “small government, big market” dogmas that originated from the era of British rule, and both are tenets of passive governance. The government has abandoned its past policy of not grooming or picking particular industries. Today, it promotes, sponsors, and funds the emergence and development of industrial sectors with high-technology content and high-added value conducive to transforming and upgrading traditional sectors within its capabilities. These tasks are closely related to opening new development space for Hong Kong because only by providing high-end goods and services can it attract enterprises and institutions from the Chinese mainland and overseas to take advantage of the facilities it offers, thereby allowing Hong Kong to enhance its role as international or regional economic, trade and service hubs.

Of course, whether Hong Kong can achieve results under the new development strategy, in addition to its continuous reform, innovation and development, the Chinese mainland’s economic development is crucial. 

Those doomsayers prophesying bad times ahead for Hong Kong take a similar view of the Chinese mainland. They assert that the mainland’s development has reached its peak and is stuck in a “middle-income trap” from which it is difficult to escape — or the country may even collapse altogether. Those people are regurgitating some cliches and posit that if China does not return to the Western economic development model, China’s economic miracle will eventually evaporate. However, according to official data, despite facing many difficulties and headwinds, China’s economy is still growing decently, and the emergence and development of new industries with high-tech content and having a significant impact on other sectors are injecting new impetus into the country’s long-term economic development.

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Both the country and its HKSAR have experienced severe impacts from the COVID-19 pandemic, US and Western oppression, and global economic and political turmoil. Hong Kong was, in addition, devastated by months of rioting in 2019-20. The country and its HKSAR must implement new economic development strategies under the new international economic landscape. The country and its HKSAR are in a difficult stage of strategic development transformation. They will have to endure a period of pain and disruption. The US and the West will inevitably obstruct and impair the country’s and its HKSAR’s development. Unsurprisingly, there are some short-term difficulties and problems in the economic situation of the country and its HKSAR, and these short-term difficulties and problems will inevitably become reasons for US and Western experts to express pessimistic views on the mainland and Hong Kong. 

However, it is more reasonable to take a long-term view, and it is unfair to regard the short-term difficulties, which are easing, as signs of their decline or collapse. Since the country and its HKSAR must change their development strategies to cope with the new international economic and political challenges, they have no alternative but to embark on a new journey and create a favorable situation with determination and perseverance to fight against the odds. There are numerous positive factors favoring China’s new development strategy. It is too early to judge the prospects for both the country and its HKSAR. On the contrary, I am sure that the so-called experts who speak ill of the country and its HKSAR will eventually become a laughingstock again, like their counterparts in the past. They are so sure of themselves right now because they still stubbornly believe that the development model of the West is a one-size-fits-all model.

The author is professor emeritus of sociology, the Chinese University of Hong Kong; consultant, Chinese Association of Hong Kong and Macao Studies.

The views do not necessarily reflect those of China Daily.