Stephen Roach, former Morgan Stanley Asia chair and once considered Beijing’s “good friend,” said he was prohibited from expressing differing opinions on Hong Kong during his attendance at the China Development Forum in Beijing last week.
In late March, Mr. Roach was invited to attend the China Development Forum held at the Diaoyutai State Guesthouse in Beijing as the senior fellow at Yale University’s Jackson Institute for Global Affairs.
‘Hong Kong is Over’
Previously, Mr. Roach’s remarks that “Hong Kong is over” attracted widespread attention.“It pains me to admit it, but Hong Kong is now over,” he wrote in a commentary in the Financial Times on Feb. 12.
According to the economist, political factors—along with international circumstances—are contributing to Hong Kong’s demise.
“The Hong Kong stock market has long been considered as a levered play on mainland China,” he wrote.
“For a variety of reasons, the Chinese economy has hit a wall. Structural problems, especially the dreaded three Ds—debt, deflation, and demography—have combined with the impact of the COVID pandemic, as well as cyclical pressures in the property market and local government financing vehicles.”
“I will never forget my first trip to Hong Kong in the late 1980s,” the economist said at the end of his article in an emotional reflection.
“China was just beginning to stir, and Hong Kong was perfectly positioned as the major beneficiary of what turned into the world’s greatest development miracle. It all worked out brilliantly, for longer than anyone expected,” he wrote. “And now it’s over.”
The article has sparked strong controversy, with multiple Hong Kong officials refuting it. Regina Ip Lau Suk-yee, convenor of the Hong Kong Executive Council and Legislative Council member of the New People’s Party, has engaged in a number of verbal exchanges with Mr. Roach regarding this matter.
Mr. Roach pointed out that his “Hong Kong is over” remark touched on some sensitive issues in Beijing, causing serious concern among Chinese Communist Party officials.
He also criticized the Hong Kong academic and business representatives at the forum for not faithfully reporting the situation in Hong Kong to Beijing.
On a separate occasion on the sidelines of the forum, Mr. Roach discussed China’s financial market policies with Laura Cha, the chairperson of the Hong Kong Stock Exchanges, and raised three points: the interdependence of Hong Kong and China’s economies; concerns about the adverse impact of political conflicts between China and the United States on Hong Kong trade; and concerns about the implications of Article 23 on Hong Kong’s autonomy.
“I said all three of those will spell trouble for Hong Kong in the years ahead, and Laura Cha agreed with two of my three points—the Chinese economy the adverse impact of the U.S.-China conflict,” he said, adding that his argument was based on economic, not political, considerations, and that there was little opposition to his core argument.
The highly controversial legislation, which resulted in over 500,000 Hongkongers taking to the streets to protest in 2003 when it was first proposed, copies its definition of “national security” from mainland China, where it is a vaguely defined concept that includes “major interests of the state,” according to Amnesty International.
Regarding whether Article 23 is suitable for resolving political disputes in Hong Kong and whether it might be overly enforced, Mr. Roach believes that the long-term effects will require historians to make conclusions.
However, he said that the legislation had cast a shadow over the political and policy-making autonomy of Hong Kong under the principle of “One Country, Two Systems,” which was promised by Beijing when it took the city back from the United Kingdom in 1997.
He also expressed concerns that under the backdrop of Sino-U.S. conflicts and the impact of Article 23, there could be an exacerbation of the outflow of foreign talent.
Many international securities firms are particularly concerned about a significant decline in performance in the Asia-Pacific region, and management teams are discussing the political risks of doing business in Hong Kong, he said.
Mr. Roach has participated in the China Development Forum annually for the last 24 years since 2000, when the forum was first held, making him one of the longest-serving foreign representatives at the event.
He recalled the forum’s proceedings in 2001 during former Chinese premier Zhu Rongji’s era, when Mr. Zhu sat in and issues could be discussed freely and openly.
“I urge current Chinese and Hong Kong leaders to do likewise. Debate on issues and not based on personal political agendas,” he said.
At the end of the interview, Mr. Roach said that although he had only worked in Hong Kong for a short period of 6 years, he has a strong affection for the city.
When asked if he was concerned about not being able to visit Hong Kong again after the enactment of Article 23, he said, “If constructive criticism causes uncomfortable reactions from politicians and business people, they need to look at themselves.”
