This is China, and this is China, yet the degree of difference between the two sides of this line far surpasses that of many, perhaps even most international borders. Growing from a fishing village into one of the world’s wealthiest cities almost entirely within its 156 years of British Colonial rule, the 27 years since Hong Kong’s return to China have done little to blunt the full totality of its anomalies from the mainland, but Beijing’s now trying to change that—and fast. This is proving challenging.
Much of Hong Kong is quite literally as different to the mainland as it can be. North of the border, vehicles drive on the right; in Hong Kong, they drive on the left. Hong Kongers get their own passports—some of the strongest in the world, in fact, with visa-free access to 172 countries.
Mainlanders, meanwhile, only get relatively weak Chinese passports granting the same rights to just 90 nations. Hong Kong has unrestricted access to the entire internet, China’s is some of the most restricted and censored in the entire world. In fact, Hong Kong is so isolated from the rest of China that mainland residents are not even allowed to visit the territory without applying for and being granted a permit, whereas the residents of the UK, US, and 168 other countries can visit without any visa or permit—it is quite literally easier for most foreigners to visit the city than Chinese people.
But then there’s the less tangible side—the general, international flair to the city borne out of Britain. For example, Hong Kong’s traditional tea is closer to the British preparation since it relies on milk—uncommon in traditional Chinese cuisine due to the lactose intolerance experienced by 90% of ethnic Chinese. There’s also the ever-present egg tarts—a direct lineage of the British custard tart, ubiquitous across the city's bakeries and restaurants, and even now in Hong Kong-style dim sum restaurants in the rest of the world.
With high levels of English proficiency, day-to-day exposure to Westerners, access to international media, and more, Hong Kong, while in a category of one, is far more similar to places like London or New York than any other Chinese city. But Hong Kong’s distinction goes deeper than that. Perhaps the greatest source of difference is in the very core of its legal and political system.
China, after all, is a communist state—a political structure just about as fundamentally different as possible to those used in the west. Hong Kong, meanwhile, is a free-market, capitalist economy centered by a western, democratic system based on English law. With the handover of Hong Kong to China in 1997, this system was adapted and enshrined into Hong Kong Basic Law—in broad strokes, this guaranteed the maintenance of the status quo of democracy, capitalism, and the English legal system until at least 2047.
So in the era since the handover, you have a strange, singular situation where a communist, autocratic country oversees a capitalist, democratic territory—a fundamental incompatibility that the pair have increasingly and painstakingly attempted to rectify, such as in 2019 when the Hong Kong government proposed an amendment to the territory’s Basic Law. It was called the Fugitive Offenders and Mutual Legal Assistance in Criminal Matters Legislation. The law was born out of a murder, as a 19-year-old Hong Konger killed his girlfriend in Taiwan, admitted to doing as much, but then couldn’t be extradited back to Taiwan because there was no formal extradition agreement between Hong Kong and Taiwan.
To close what they called a loophole, the pro-Beijing party, the Democratic Alliance for the Betterment and Progress of Hong Kong, presented some changes to the law: that special surrender arrangements would be considered on a case-by-case basis to any jurisdiction, regardless of their prior extradition relationship with Hong Kong. While this would only apply to 37 specific schedule 1 offenses—which range from murder and piracy to offenses involving the unlawful use of computers—it was received by the Hong Kong public as a serious concern. Now, it seemed, any brush with the law could see Hong Kongers whisked away from their western-style courts and legal system and thrown into those of mainland China’s.
For people with such a cultural distance from their next-door neighbor, it seemed like another slide toward Chinese rule—and they wouldn't stand for it. The protest began in earnest here, well before it became global news, with a student-led sit-in at the Central Government Complex. Then, the movement grew: 10,000 marched in protest two weeks later, then, a month after that, a crowd that organizers claimed to be around 130,000 marched in protest against case-by-case extradition toward the legislative council.
Still, while the largest protest in five years, the bill, and its most prominent proponent in Chief Executive Carrie Lam, maintained that the extradition rules were to become law. But over the weeks and months that followed, the protests continued to snowball into the massive demonstrations that reached global headlines and ranked as the largest in the city’s history, and eventually Carrie Lam gave in and withdrew the legislation. So in the short-term, the protests won the battle, effectively striking down Hong Kong legislation that felt like it empowered the mainland.
But it also served as justification for another legal maneuver that may have forever displaced the balance between eastern and western influence in the city. This was a new national security law, and it was annexed, in its entirety—all 6 chapters and 66 articles—by a vote of 162 to zero. This criminalized acts that could be considered subversion from China, or efforts of secession from China, or terrorism toward China.
As Lam saw it, such an act had been justified by the protests, but critically, unlike the extradition legislation, this new law didn’t have to clear Hong Kong legislation, as it was introduced then passed by the National People’s Congress, then signed by Xi Jinping—an almost unheard of instance of Beijing imposing laws on the supposedly autonomous Hong Kong. This was a massive break from the norm. While similar security legislation had been presented in 2003, it was brought to the fore by Hong Kong officials, and it was subsequently dismantled by protestors.
But now, in the grips of a global pandemic that had Hong Kongers assembling in no larger than groups of eight, and in the wake of what China viewed as a secessionist and terrorism upswell in the year prior, the nation took legal reform into its own hands. The legal case to do so was dubious. The Hong Kong bar association protested, the western world strongly denounced the move.
But strangely, the streets were quiet. Unlike during previous perceived oversteps by China, Hong Kongers didn’t take to the streets, they didn’t organize in the thousands around the universities. Rather, when reporters asked about the new laws, they stayed suspiciously mum.
And, one by one, organizers and activists focused their energy not on saving Hong Kong’s special status, but getting themselves and their families out of Hong Kong as quick as possible. As the UK opened up a path to citizenship for Hong Kongers who lived in the city during British rule, well over a hundred thousand opted to move to the former colonizer, while hundreds of thousands more opted to move elsewhere. For many, confidence was lost that the territory could ever return to what it was before.
But it is worth noting: Hong Kong has never been a true, full democracy with universal suffrage. For much of the colonial period, like most colonies, Hong Kong was essentially ruled outright by the Governor, who themselves was the representative of the British monarchy. But in the 1980s, the system started to evolve into something closer and closer to universal suffrage—where everyone gets to vote.
In the 1990s and 2000s, the territory experienced its most representative form of democracy ever, yet from the 2010s to today, that has started to regress as Beijing institutes a series of so-called, “reforms. ” Now, Hong Kong’s elections system quite literally may be one of the most complex in the entire world. But much of it stems from what’s called the Election Committee.
This is a 1,500 member body who votes for the Chief Executive—the head of the government. How this body is formed is convoluted and has changed with each of the last three elections. In the 2016 election, though, 106 of the positions were just directly appointed—the President of the Hong Kong Polytechnic University, Chairperson of the Drnking Water Safety Advisory Committee, and Chairman of the Antiquities Advisory Board, for example, each automatically gained a seat in the Election Committee.
But the vast majority of seats were themselves voted upon by so-called functional constituencies. In 2016 there were 38 of these each representing a variety of interests—there was one for the financial sector with 18 seats, another representing Chinese Medicine with 30, even one representing religious interests with 60 seats. Now, each functional constituency itself has a different way of determining who fills its election committee seats.
Some, like the education constituency, allow for widespread voting—every registered teacher and many higher-level administrative staff in educational institutions are allowed to vote on who they send to the committee, and therefore have an indirect say in who gets appointed as Chief Executive of Hong Kong. But bizarrely, about 42. 5% of total election committee seats were voted upon by organizations and corporations.
In the finance constituency, any registered bank that has been operating for at least three years votes—not individuals working at the banks, the banks themselves. Yet for other constituencies, like that of transport, the eligibility criteria is simply just a list of companies. There are 229 that can register to vote in this constituency, and that’s how Gate Gourmet, for example, the Swiss-Owned airline catering company, ends up with the right to vote for the individuals who then go on to vote for the most powerful politician in the territory.
Clearly, this system had its critics. The very fact that the head of the government was voted on by 246,440 voters, rather than all seven million residents of the territory, would be enough to elicit controversy, but then there’s the question of the composition of this voter-base to begin with. Politics in Hong Kong typically are split into the so-called pro-Beijing and pro-Democracy camps.
There’s the group that supports increased control by the central government, then there’s the group that supports increased autonomy and democracy for Hong Kong. These functional constituencies, and therefore the election committee, consistently skew more towards the pro-Beijing camp than the general public. For example, in the 2012 legislative council elections, some seats were voted upon by the general public in geographic constituencies, while others were voted upon by the same functional constituencies.
The pro-Democracy camp actually beat the pro-Beijing camp in the directly elected seats—winning 18 to their 17. But considering pro-Beijing won the vast majority of functional constituency seats, 26 to pro-Democracy’s 9, the pro-Beijing politicians won a strong majority in the legislative council—as they have in every single election in the Chinese era. But something changed in late 2019.
In the midst of the wide scale anti-extradition protests, the territory held its District Council elections—essentially, the local elections. Unlike the territory-wide legislative council or Chief Executive elections, the vast majority of District Council seats were directly elected by the general public. And the pro-democracy camp showed up in force.
For the first time ever, they won in the popular vote—a full 57%—and won a colossal 388 of 452 seats—an absolutely massive jump from their previous total of 126. With legislative council and Chief Executive elections on the horizon in 2021 and 2022 respectively, Beijing decided it needed to make some changes if it were to ensure its supporters stayed in power. China’s National People’s Congress—which itself is a body whose members are technically elected but in a process almost entirely controlled by the Chinese Communist Party—voted in 2021 to reform the composition of Hong Kong’s legislative council.
Previously, half of the seventy seats were directly elected by the general public, while the other half were elected by the functional constituencies. But now, there’d be ninety total seats with just twenty directly elected by the public, thirty elected by the functional constituencies, then another forty elected by the election committee—which itself, of course, was made up of members voted in by the functional constituencies. Overall, this massively tilted power away from the people and towards the historically pro-Beijing functional constituencies.
But that was far from the full extent of the reforms. The election committee, despite its perfect history in voting in a pro-Beijing chief executive, was itself reformed too. Typically, the strongest block of support for pro-democracy politicians comes from the functional constituencies made up of people, rather than institutions.
For example, the education constituency, made up of 85,000 teachers, academics, and administrative staff, was always one of the few pro-democracy constituencies. But with the 2021 reforms, the number of seats filled by these functional constituencies made up of real people was slashed—many by half, some by four times. Meanwhile, the number of seats voted in by companies and organizations stayed about the same, while they also added more than three hundred new ex-officio seats—those filled by someone already in another position, in this case almost all inherently pro-Beijing positions.
If that wasn’t enough, all candidates for essentially any political position in Hong Kong now had to be approved by a candidate review committee—one that follows ambiguous criteria and has absolutely no mechanism for appeal. The members of this committee, that decides among other things who can run for the seats that vote for the Chief Executive, are directly appointed by the Chief Executive. Democracy is dead in Hong Kong.
The pro-Democracy camp, which just years ago was able to win the popular vote, now has absolutely no viable path towards any position of power. China has remade the city in its own image—a political system that claims to represent the will of the people, but in actuality hands near-complete control over to the central government. Beyond and because of the changing political system, there is now also a widespread trend of Hong Kong becoming more integrated—literally, functionally, and culturally—with the mainland.
In 2018, a $20 billion bridge opened connecting the peninsula to both Macau, another autonomous territory, and the mainland on the other side of the Estuary. This was considered by many a symbolic project more than anything. After all, there was already a reliable and popular network of fast ferries connecting Hong Kong to Macau, and road traffic between both territories and the mainland is quite limited—the territories drive on the opposite side of the road as the mainland, and even then, driving a vehicle across the border requires a separate driving license, a permit, separate insurance, and approval by the neighboring Chinese region, so very few even attempt it.
But a far more practical connection opened with the West Kowloon railway station in 2018. This connected Hong Kong to the Chinese high speed rail network, meaning one can now travel non-stop well over a thousand miles across the country to Beijing or Shanghai in about eight hours. This was also controversial.
After all, to make it nonstop, without a long wait at the border, mainland Chinese immigration would have to happen at the station itself. This meant that mainland officials would operate within Hong Kong and, most problematically to supporters of Hong Kong’s autonomy, mainland law would be in force after the immigration checkpoint, meaning there is now this small area in Hong Kong within West Kowloon Station and on the tracks out from it where many believe Basic Law, stipulating the autonomy of Hong Kong’s legal system, has been violated. After all, there have now been instances where individuals have been arrested and prosecuted under mainland law while physically in Hong Kong, but after clearing mainland immigration in West Kowloon station.
Beyond the increasing physical connection with the mainland, there’s simultaneously a mounting intangible alignment with China. This is not necessarily wrong—after all the vast majority of Hong Kongers are ethnically Chinese—but it is often controversial and many see it as coming at the expense of maintaining Hong Kong’s unique, singular identity. For example, the newly opened half billion dollar Hong Kong Palace Museum displays artifacts from the Beijing Palace Museum, and focuses on educating the public about the history of imperial China.
But they’ve been very careful to phrase it as a partner, not a branch, of the Beijing museum, even if in function it could be either. Critics suggest that its development could have been forced through by Beijing as a form of cultural propaganda as Chief Executive Carrie Lam approved its construction without any consultation from the legislative council or public—and critics say this is a violation of the rules of the cultural district in which it’s built. COVID was another example of alignment with China.
Pragmatically, Hong Kong had no choice but to align its prevention measures with Beijing’s severe and scientifically controversial zero-COVID policies. After all, not doing so would act as public doubt in Xi Jinping’s decision-making, which is not a realistic option for Hong Kong’s ruling pro-Beijing leadership. But especially in the later years of the pandemic, this served as a stark display of just how Chinese this supposedly Westernized city had become.
Throughout 2022, the territory maintained strict policies like 21-day quarantines for arriving passengers, legally-enforced isolation for the sick, vaccine passports for access to public places, and more. Meanwhile, most of the western world got back to normal in early 2022 as the Omicron-fueled surge subsided. Ultimately, Hong Kong’s strictness, borne out of Beijing’s influence, seemed to get it the worst of both worlds.
The city had an extremely high COVID death rate—higher than most Western countries, and far higher that most of the Asian continent. And perhaps most notably, Singapore, perhaps Hong Kong’s closest equivalent, did not see the same. 2,024 people died of COVID in Singapore, or about one in 2,800 people.
In Hong Kong, though, 13,516 died—that’s one in 550. But Singapore’s COVID policy was far less strict. It opened its borders to the world about a year before Hong Kong, and was devoid of almost all visible restrictions by late 2022 while Hong Kong was still in the midst of its strict zero-COVID policies.
This had an impact because the cities are direct competitors. They both portray themselves as global business capitals—the perfect hub of east and west, with high English proficiency, strong local talent, and easy access to financial services and other important institutions. And they are each successful at this.
Singapore is home to the Asian headquarters of Apple, Google, Johnson & Johnson, Chevron, Barclays, Microsoft, Boeing, and plenty more while Hong Kong acts as the headquarters of J. P. Morgan, Prudential, Estée Lauder, and more, but the composition of these lists reflects the changing nature of multinational enterprise in Asia.
Singapore is winning. It is consistently being chosen as the best city for western companies to base their Asia operations out of. This is reflected by the fact that Hong Kong barely has any tech presence, as the new wave of businesses has consistently chosen the city-state to the south.
And they’re not losing out on new business, they’re also just simply losing business. FedEx and the Wall Street Journal were two of the highest profile headquarters moves from Hong Kong to Singapore in recent years, while others have selected elsewhere. The New York Times, for example, moved its Asia headquarters to Seoul, while LVMH—the luxury goods conglomerate including Louis Vuitton, Sephora, Tiffany, and dozens more brands—opted to move up to Shanghai.
In fact, the number of American businesses with regional headquarters in Hong Kong is now declining, and at 214, it’s at its lowest count since the year 2000, and a similar trend is seen for British and Australian firms as well. Since 2018, Hong Kong’s economy has been effectively flat—it’s only grown a marginal 5. 8% in five whole years.
Over the same span, Singapore’s has exploded a full 33. 2%. Since 2021, Hong Kong’s historically red-hot property market has been on a steady decline.
And tourism figures have been terrible, at numbers not seen since the early 2010s. Hong Kong is just not what it once was. Its quagmire seems centered around the fact that it’s losing what made it unique.
The destinations of the businesses leaving the city reflect this. Shanghai is certainly the city best-suited to international companies in mainland China, so it makes sense the companies that want to further focus on the Chinese market, like LVMH, would move there. Singapore, meanwhile, has effectively stepped in to be what Hong Kong once was.
It is tremendously cosmopolitan—at times it’s hard to categorize it into any one continent—and yet it still has high exposure and proximity to China. Also a former British colony, Singapore also runs on a western legal system, also has high English language proficiency, and also runs as a democracy—although also an imperfect one. But perhaps most importantly, Singapore is, of course, its own country.
It is not subject to the same game of tug of war between the world and China as Hong Kong. It is therefore perceived by many as a more stable environment. Hong Kong is changing fast, and when a company is deciding where to invest hundreds of millions of dollars to build a headquarters, fast change is not attractive.
In 2021, the US Departments of State, Treasury, Commerce, and Homeland Security jointly issued an advisory warning US companies about the growing risks in operating in Hong Kong. The document notes the risks to foreign nationals and businesses placed by the new National Security Law, that data security is no longer a guarantee, and that there could be challenges with access to information given growing constraints on the freedom of the press in the territory. And beyond the direct implications of these threats, multinational companies rely on the ability to convince key talent to move to their offices in Asia, and there’s a significant number of westerners who are wary of moving to a place that is increasingly influenced by Beijing.
So to the decision-makers, it’s now hard to see what Hong Kong uniquely offers. There’s the option of Shanghai if a business wants a cosmopolitan city with direct access to mainland China, and then there’s Singapore if they just need proximity and familiarity. The city is just consistently losing, and the trend-line is the scariest bit.
It’s tough to know what Beijing’s end-game is. Hong Kong is a useful tool for the central government as it’s difficult for western companies to operate in China’s unique economic and legal system, so the city almost acts as a connecting node between China’s socialist economy and the western capitalist one. This almost certainly increases the flow of capital into the country while simultaneously allowing the Chinese Communist Party to maintain their brand of socialism.
Perhaps it’s just instinct. Xi Jinping and the other autocratic leaders in China just don’t know how to deal with dissent. This has been demonstrated by the Tiananmen Square Massacre, by the lack of free press, by the censorship of media—the instinct is to just prevent dissent from happening in public, rather than confronting its cause.
But in a democratic system, dissent is inherent. In a democratic Hong Kong, therefore, there will always be an anti-China camp. So perhaps, in the long term, one country, two systems was never going to work, but it’s also possible that in the future the world will look back on Hong Kong as an example of Chinese short-sightedness—the destruction of a once-great city out of fear of what democracy could do to Beijing.
Rather than do a traditional ad-read here at the end, I’m just going to play the trailer for the new show me and my team made called the Getaway. Although I’ll say now: there is a bit of a twist in this trailer, so it’s worth watching at least halfway through…
“Welcome to The Getaway where these six creators are taking a road trip to transport a $10,000 prize across the great American West. The problem… there's a Snitch among them!
Sabotaging the group at every turn. The Gamer? Am I 1,000% sure I am not the Snitch?
Absolutely. The Zoologist? Is there nothing I can say to change your mind?
The Therapist? You guys trust-trust each other? Actually trust each other?
The Card Counter? I'm not— I'm not throwing shade at you. But the way that I think it would be smart to do it— Steven!
The Finance Guy? This Snitch thing is very stressful. I go to bed at night, and I worry.
The Political Scientist? I have this suspicion that. .
. we did get the Snitch. You really never know.
Sure. Okay. This is a tense moment.
Okay, here we go. What am I? Alright, nice.
Ohh yeah. Snitch. So here's what's actually going on.
We really like shows that have, you know, a sabotage element. But there's already so many that have a saboteur. Okay.
Alright. I have this special role. I'm really carrying this entire series.
There's even the ones that have a couple of saboteurs. Boston I don't believe in. Jersey I don't bel… It's Boston.
Boston was never the city. But as far as we know, there's none that have everyone as the saboteur. And we thought that would be funny.
In some way, I'm like, are there two Snitches here? We got— We gotta run! Oh my (bleep) god!
There's no script for this. So, you know… That's a great—Oh, that's gonna make the trailer, dude. Yeah.
Yeah. You mother—” You can watch the Getaway exclusively on Nebula, so head over to Nebula. tv/Wendover to sign up and you’ll even get 40% off an annual subscription, bringing the cost down to just $2.
50 a month. With that you’ll get access to the full catalog of top-notch Nebula Originals made by creators you probably already watch and love, plus access to all of our normal videos early and ad-free, and you’ll be helping support our work, so thank you in advance.
