The Roots of Hong Kong’s Crisis
By Henry Huang
Hong Kong, the pearl of the East, lives in such turmoil. The ongoing political crisis and massive protest have drawn a large amount of international concern and attention. There are multiple explanations of what has happened in Hong Kong. Some say it is for a “wider demands for democratic reform.” On the mainland side, some argue, “The demonstrations in Hong Kong are not about rights or democracy. They are a result of foreign interference.”
However, people ignore another important perspective of the protest in Hong Kong, economics. Hong Kong does have a strong economy, it plays an important role in international trade and financial services. However, under prosperity, there are extreme challenges that will lead to explosions in Hong Kong society. The unbalanced economic development, enlarged inequality, and the failure of the Hong Kong government in addressing economics issue fueled the anger of the people and dragged Hong Kong into the ongoing crisis. The extradition bill, in my opinion, is just the spark that ignited the society’s anger.
Unbalanced economic development was a major issue of Hong Kong in recent years. When we look back into the history of Hong Kong, the economic booming started from the 1950s and 1960s when Hong Kong enjoyed a booming economy. It had the opportunity to grow in those eras by developing textile, electric, and light industries. Manufacturing became Hong Kong’s main industry until the 1970s when finance, real estate, and trade picked up the main role. The Reform and Opening in China in 1979 further fueled the development of Hong Kong in trade and finance.
Currently, financial services, tourism, trading, professional services and other producer services are the four main industries of Hong Kong. These industries have attracted 47.3% in the labour force and are contributing 57.8% of the GDP. However, the problem is that there is only a limited spot of high paying jobs in these industries. Many of these jobs either require higher education or there aren’t enough positions available for the people. From 2013 to 2017, these four industries created only 20,000 new jobs while more than 100,000 people joined the workforce. The rise of China as an international economic powerhouse has made Hong Kong even less competitive in these traditionally advantageous industries. The rich make more money than ever while every day, some people live in cages.
Years ago, an executive officer wanted to promote the manufacturing industry and public housing programs to provide a more diverse economy and affordable housing opportunities. However, he wasn’t successful. On the real estate perspective, in the first policy address for the Chief Executive, Tung Chee-Hwa promised to build 85,000 affordable houses for the public. However, the program failed due to mass protests from middle-class Hong Kong residents who lost drastically in the real estate market. The cancellation of Public Housing programs between 2004 to 2014 has made the housing market worse. Tung Chee-Hwa also tried to promote programs such as Cyberport, which will help Hong Kong to develop a solid technology industry. However, it was born in the wrong time, right before the explosion of the internet bubble.
We all understand that when the economy is in bad shape, when there are not many opportunities left for young people in the labour market, or in the society as a whole, something will happen. These feeling of loss eventually became the anger towards the government, and the Extortion Bill was just the spark that ignited the social conflicts within Hong Kong.
Henry Huang is a Campus Fellow at the International Institute for Peace, Democracy, and Development. He lives in Washington, DC where he is a student at the George Washington University’s Elliott School of International Affairs.
Views of the author are personal and do not necessarily represent the website’s views.
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