Now it’s Jimmy Lai’s turn

A former chair professor of law at HK University makes a key point about the HK47’s trial: if it is illegal for lawmakers to reject a government budget, why does the Basic Law set out procedures that follow such an action?

When asked by the radio show host if the 45 democrats had severely interfered with or disrupted the government’s ability to carry out its duties, [Johannes] Chan said: “If we view it from that perspective, it would leave the design of the Basic Law futile.”

The US imposes additional travel-related sanctions on certain Hong Kong officials…

US Department of State spokesperson Matthew Miller said in a statement on Tuesday that the US “strongly condemns” the sentences meted out in Hong Kong’s largest national security case, which ranged from four years and two months to 10 years.

“The 45 defendants sentenced today were aggressively prosecuted, and many now face life-altering imprisonment simply for their peaceful participation in political activities which are protected under the Basic Law of Hong Kong,” Miller said.

The Hong Kong government’s issues the inevitable response to overseas criticism from (take a deep breath)  ‘some government authorities and officials of Western countries (including the United States (US), the United Kingdom (UK), the European Union, Australia, Canada and more), anti-China organisations, anti-China politicians and foreign media’…

“The proposed imposition of the so-called ‘visa restrictions’ on HKSAR officials by the US Government smack of despicable political manipulation to intimidate People’s Republic of China and HKSAR officials who resolutely safeguard national security. These grossly interfere in China’s internal affairs and Hong Kong’s affairs, and violate the international law and the basic norms governing international relations. The HKSAR despises such threats and will not be intimidated by such despicable behaviour. The HKSAR will continue to resolutely continue to discharge the duty of safeguarding national security.

As with the HK47, some may find it hard to see exactly what criminal acts Jimmy Lai committed. Although the Chinese Foreign Affairs Ministry sees otherwise

Jimmy Lai is the principal mastermind and perpetrator behind the series of riots that shook Hong Kong. He is a lawbreaker and an agent and henchman of those hostile to China.

HKFP’s report on his court appearance yesterday. The government needn’t rush to issue a riposte to foreign criticism on this case, as there are weeks (at least) to go.

But still time to squeeze one more in…

The Hong Kong Special Administrative Region (HKSAR) Government today (November 20) strongly disapproves of and firmly rejects the groundless attacks, slanders and smears against various aspects of the HKSAR in the so-called “report” issued by the United States-China Economic and Security Review Commission (USCC) (Report).

Here’s the offending document. A very long read, but worth a skim…

The Commission recommends [that] Congress require the Administration to produce a determination whether reasonable grounds exist for concluding that the Hong Kong Special Administrative Region should be designated as a Primary Money Laundering Concern (PMLC) jurisdiction under Section 311 of the Patriot Act due to its growing role as the central sanctions evasion hub and transshipment center for illicit finance and technology to Russia, Iran, and North Korea.

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HK47 sentences – what you’d expect

Most of Hong Kong’s leading pro-democracy figures are sent to prison for trying to win an election.

The sentences could have been even harsher. Maybe that’s going to be the narrative: government appeals for longer spells in prison after oh-so independent judges prove too wishy-washy.

Benny Tai, who gets 10 years, is being cast as ringleader and ‘advocate of a revolution’. Perhaps he is guilty of knowing the wording of the constitution too well – better than Beijing’s officials did back in April 1990 when they promulgated the Basic Law. (The government and court see a distinction between lawmakers rejecting a budget ‘indiscriminately’ and in some other way. The Basic Law doesn’t mention any such difference, but apparently the former is ‘subverting state power’.)

Several others who helped organize the primaries get sentences of around six or seven years (after, like Tai, pleading guilty). Other participants get four to seven, with those pleading guilty getting the lighter penalties. Pleading guilty in such circumstances is rational. Most have already done several years in jail. HKDC projects likely release dates: 13 in 2025, 8 in 2026, 5 in 2027, 7 in 2028, 1 in 2029, 9 in 2030, 2 in 2032.

Some of these people are brilliant in such areas as the law, housing/land policy and community service, and would wipe the floor with many of the lawmakers and policymakers who pass the ‘patriots only’ test. 

Kevin Yam says

Every single one of these sentences is a travesty in itself. But the one that really topped it all was the Gordon Ng sentence (and not just because he’s a fellow Australian): 7 years and 3 months for being a bit player in the process, doing nothing more than running a Facebook page that encourages people to vote in an informal process? Really?

I reiterate: these people have been convicted and jailed for (a) trying to work within the HongKong Basic Law process for dealing with legislative deadlocks over government budgets; and (b) doing what politicians in democracies routinely do (threatening to filibuster budgets and other laws to try and gain a particular political or policy outcome). 

Now personally: I am not OK today. Benny Tai was the co-author of my first academic article over 20 years ago before either of us were activists. Alvin Yeung used to live near me. Claudia Mo was active in my neighbourhood as a politician. Lam Cheuk-ting and Helena Wong were people I campaigned for in the past. Leung Kwok-hung and I shared a love for whisky. I can go on and on. These people were friends and comrades. This is not just political – it’s personal for the defendants, their families and their friends. For all the inconveniences and stresses of a bounty over my head, it does not begin to compare with those who are languishing in prison for doing things that would be considered normal in free societies.

From Gwyneth Ho’s statement on Facebook…

12. The situation is dire, yet when going into the details, it becomes a bit comical: the unforgivably evil subversive act of the accused was aiming for a parliamentary majority with the power to veto the annual budget. Following such logic, one may as well claim that democracies around the world suffer subversion attempts every 4 to 6 years. In a 1984-esque reality, though, democratization—or just calling for it—amounts to subversion of state power. Makes perfect sense.

13. Behind the rhetoric of secession, collusion with foreign forces, etc., our true crime for Beijing is that we were not content with playing along in manipulated elections. We organized ourselves to rise above partisan fragmentation, came together, and attempted to break through. We dared to reach for actual power to hold the government accountable. Even though it was enshrined as a right of the people under the Basic Law, Beijing never planned to see it actualized.

(For those who can’t stand/access Facebook, the whole thing is below).

From the Wall Street Journal

The trial displayed just how firmly Beijing has cemented its control of Hong Kong, a former British colony that was returned to China in 1997. While the territory was once a hotbed of dissent, the mass protests that once filled the streets have disappeared. The legislative council, which once had a vocal pro-democracy faction, now has no opposition.

“This is the trial that put all the opposition, pro-democracy leaders in jail,” said Eric Yan-Ho Lai, a research fellow at the Georgetown Center for Asian Law. “It’s unprecedented, because before 2020, Beijing had long been tolerant of political dissent in Hong Kong for decades.”

UK Member of Parliament Yuan Yang mentions the case.

Much more such international coverage and commentary is on the way, with Hong Kong government responses no doubt to follow. 

Gwyneth Ho’s full statement…

1. I first read about Maria Kolesnikova before I was taken to punishment—tales of how she ripped her passport apart at the border to refuse deportation, choosing jail over exile, along with trivial accounts of solitary prison life. How, as a professional flutist, she filled her head with imaginary flute music. How she kept on writing letters despite 80% of them being confiscated.

2. The protest in Belarus during 2020-21 was the last movement I followed real-time, before my own imprisonment. It went viral in this part of the world as protesters adopted the Be Water tactic of the 2019 Hong Kong Movement. A few years on, a Belarusian political prisoner’s timely advice passed on all the way from her prison in Belarus to mine in Hong Kong in ChatGPT-translated English.

3. How curious. Today, we enjoy multiple advanced communication platforms, yet people are more polarized than ever. Genuine and honest conversations have become more difficult, rendering democracy less and less convincing as the better system in the face of multiplying crises. But, now living in a world of only pen and paper, with heavy scrutiny and severe delays spanning weeks—I relearn, time and again, that genuine human connection is possible and why it is worth fighting for.

4. The Hong Kong democratic movement of 2019 is renowned for its impressive arsenal of tactics, combined with the creative use of technological platforms. These tactics travelled across social media, were transplanted into other movements, and bloomed anew. But what holds people together and makes all the creativity possible lies beyond technology or tactics. The movement itself is open to interpretations (and criticisms), yet what has stayed with me to this day, nearly four years later, is something simpler.

5. People are engaged. They are eager to connect with each other. Injustice and oppression, once witnessed, together with bravery and determination, once felt, bred an unstoppable urge to express oneself politically and to be part of the struggle; but it didn’t turn into a homogenizing essentialism. Learning from the failures of past movements, people made extra efforts to communicate and incorporate diverse ideas. We did not avoid lengthy, difficult conversations, even amid imminent violence, with rubber bullets flying over our heads. We were adamantly leaderless, each taking our own initiatives and emphasizing individual and equal contributions to the movement. We remained vigilant against disinformation, careful not to let rumours tear the movement apart from within.

6. Decentralization unleashed a political momentum unseen in Hong Kong and revealed the city’s exciting diversity, which had previously been constrained by traditional organizational structures. Accustomed to critical and intense political debate, people in Hong Kong only needed to overcome their hesitation about whether their actions mattered to emerge as their own initiators of creative new ways of struggle. They reformed connections into more direct, efficient, and inclusive networks of activism.

7. When social institutions crumbled one after another around us, we rose above fear and emerged as a genuine civil society, each living out the true meaning of citizenship. Though democracy was denied at various institutional levels, we built one from the bottom up.

8. Meaningful conversations are only possible when you have faith that people around you, and yourself, are not blind followers of someone else, that they are clear of what they are fighting for and take responsibility for their needs. Independent in their decisions but acting for the collective.

9. It’s not so much hope for a better future that drives the movement, because hope has always been scarce when you’re a city of 7 million facing a superpower, but that even if our vision of the future is different, we trust each other, we can rely on each other to do our best.  We trust, we act, we can create. All become one, united in our differences.

10. It was only natural that such a collective would demand to be heard and recognized in a way that the regime had to respond to. When the regime closed in and took away the people’s right to protest, we turned to the alternative path of elections.

11. I ran in the last free and fair election in Hong Kong. For that, I was prosecuted in the first Soviet(?)/CCP-style subversion case tried in a common law court. I pleaded not guilty to defend the political expression of 610,000 Hong Kong people, which the regime is trying to distort and reduce into a conspiracy of 47 foreign-brainwashed, faithless pawns, with life imprisonment on the table.

12. The situation is dire, yet when going into the details, it becomes a bit comical: the unforgivably evil subversive act of the accused was aiming for a parliamentary majority with the power to veto the annual budget. Following such logic, one may as well claim that democracies around the world suffer subversion attempts every 4 to 6 years. In a 1984-esque reality, though, democratization—or just calling for it—amounts to subversion of state power. Makes perfect sense.

13. Behind the rhetoric of secession, collusion with foreign forces, etc., our true crime for Beijing is that we were not content with playing along in manipulated elections. We organized ourselves to rise above partisan fragmentation, came together, and attempted to break through. We dared to reach for actual power to hold the government accountable. Even though it was enshrined as a right of the people under the Basic Law, Beijing never planned to see it actualized.

14. We dared to confront the regime with the question: will democracy ever be possible within such a structure? The answer was a complete crackdown on all fronts of society.

15. Prosecuting democratic politicians and activists across the spectrum, the case was seen as the turning point at which Hong Kong became a lost cause. People were scared into silence and forced to give up hope for democracy in Hong Kong.

16. Sitting in the dock, I went through the historical trials I had read about in my mind. Decades on, defiant and dignified defences seemed like natural building blocks of ultimate victory. But back in the moment, when the regime’s rule seemed infallible and change was nowhere in sight, why does one still choose to fight despite certain conviction?

17. The narrative put forward by the prosecution is not just a distortion of facts or a threat to the larger public. It goes much deeper—they are forcing the accused into self-denial of their lived experiences. That genuine solidarity was just a delusion. That the bonds, the togetherness, the honest conversations among people so different yet so connected, cannot be real after all. That the difficult co-building of a collective united in difference with a shared vision for a better future was just a utopian dream.

18. But no. They are not just idealistic dreams but realities that I have lived through. I choose to fight to prove that such connections are not only possible but have actually been lived out and continue to live on. The only delusion here is the belief that brutal oppression can ever deny their existence.

19. It is not a responsibility nor moral obligation. It is the strong urge within me to do justice to what I witnessed and experienced, for they constitute part of me and define who I was. And I am now going to define who I am.

20. I stand alone confronting these accusations, not as an individual, but as one of all those who have ever stood in the streets and raised their voices to demand autonomy for the city. As well as all those who have ever stood in the same position before unjust courts anywhere in the world.

21. I travelled far through words, from contemporary Russia, mainland China, Thailand, to 20th century Chicago, Taiwan, Pretoria. I met Navalny countless times, whose cases filed with the ECtHR are now open for all politically accused around the world to cite in their own legal battles. I learned from the Pussy Riot trial how to use the power of your opponents against you: when speech and beliefs are used as evidence against them; when speech and beliefs are used as evidence against you, you are also granted legal permission to elaborate on them, as extensively as you see fit.

22. And in this particular case, who else has more to offer than the human rights defenders in mainland China? Every final statement and paper about their decades of struggle, the legitimacy of the Chinese constitution, and the power of the people.

23. None of us have won our cases. Many I read about are still serving harsh sentences in unknown places, unheard and forgotten. Most of them would never have the chance to know how much they inspired me – the only way I could honour them was to fight the best fight I could. And so I did.

24. I was sent to solitary confinement for refuting the false testimony of a prosecution witness from the dock. Just before that I had read about Maria Kolesnikova. Her case was in closed court, but the lawyers risked their qualifications to reveal that on the day of the verdict, Kolesnikova made her final statement, a little less than 3 hours, about “moral choice, about love for people, about the future of Belarus.

25. I tried to imagine making a speech only among people who were complicit in depriving you of your freedom, looking at their apathetic (if not mocking) faces. I can’t. And yet she did. She poured her heart out in a speech she knew no one would hear a word of.

26. She was violently muted, but the reverberation! It went all the way across the Eurasian continent, breaking through closed courts and reporting bans, fenced walls and censorship to reach me at the time I needed it most. I felt close to her, even though I may never meet her. I can feel her dearly.

27. It’s that feeling again. Like looking through a cloudy gas mask into the determined eyes of a complete stranger, or walking alongside another in thick, irritating smog toward the light. I have come so far in search of it. The human connection that would only come through shared acts of courage, between individuals who dare to follow their true selves. For to dare is to lose one’s ground momentarily, yes, but not to dare, is to lose oneself

28. Today, no democracy is immune to the crisis of legitimacy that results from a deficit of public trust. Calls for the “orderly” and “efficient” rule of authoritarianism are growing inexorably. News of fruitless movements and the continued plight of persecuted freedom fighters in distant, hopeless places is certainly discouraging.

29. But you can certainly help a lot. Defend and repair your own democracy. Push back against the corruption of power, restore faith in democratic values through action. Give authoritarian dictators one less example of failed democracy to justify their rule, and give freedom fighters around the world one more inspiration to continue the struggle with better alternatives. Fight on the ground most familiar and dear to you. Prove to the world at every possible moment, no matter how small, that democracy is worth fighting for.

30. For while suffering may evoke concern and compassion, it also blurs and reduces the sufferer to a pitiful but characterless victim, part of a nameless number. What really defines our identity is not the suffering itself, but the way in which we face it. It is in action that one defines oneself, and only people who truly know who they are can open up, make new connections in the most unexpected circumstances, and bring about change. It is for the wonders of human diversity, creativity and possibility, for a world in which we can connect as our own true selves, that we dare to act, and we dare to suffer.

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Hong Kong 47 sentencing starts

Full background from HKFP. Update here. People were lining up outside the court yesterday. There are only five seats available to the public in the main courtroom. 

Reuters says

Jail terms are expected to range from several years for participants to possible life imprisonment for principal offenders.

…One defendant, Eddie Chu, a former journalist, now suffers from glaucoma and sometimes cannot see clearly which affects his mood, according to his friend Debby Chan.

John, the husband of Winnie Yu, another defendant, who did not wish to disclose his full name due to the sensitivity of the matter, said he stood by her decision to not plead guilty despite knowing the chance of acquittal was low.

“It’s because she wants to say something,” John told Reuters. “Stick to our beliefs, don’t change our thoughts easily because of others, be ourselves … I think this experience will be passed down for generations.”

Some legal experts say the treatment of the democrats has been a departure from common law traditions. Most were denied bail, and they were all denied a jury trial.

Among the 47 are popular public figures like Long Hair and Joshua Wong. If they are at liberty, they could – in theory – build active followings that develop into some sort of alternative source of power. Hence expectations of long sentences (for taking part in primary elections and a plan to use legislative budget-voting procedures defined clearly in the Basic Law to pressure the administration and potentially force it to stand down).

Jimmy Lai’s trial resumes tomorrow. (A half-minute clip here shows Chinese officials ordering reporters out of a UK-China meeting in Brazil at which Prime Minister Starmer mentions Hong Kong, Jimmy Lai and other issues.)

And farewell to Transit Jam, which was never political in the ideological sense, but pulled no punches in exposing government shortcomings in road safety and other areas…

We were forced to shut down after government threats to our founder and his family.

An update (forget which year it is).

Not only can you not hold primary elections – you can’t surf

Hong Kong has 42 public beaches managed by the LCSD and surfing is prohibited at all of them.

One of those is Big Wave Bay, which is also the only beach on Hong Kong Island that has rideable waves. Despite the ban, it has been a popular surfing spot for decades.

However, in June, the LCSD, a department under the CSTB, took the step of putting up new signs stating “no surfing” in English and Chinese, adding to the notices and banners already listing the rule.

Since then, there have been cases of police officers and LCSD staff trying to catch surfers breaking those rules.

The surfing community said the crackdown began after Undersecretary for Security Michael Cheuk Hau-yip said thrill-seeking residents were putting their lives in danger, and exposing frontline officers to risk, by chasing waves or searching out strong winds during extreme weather.

[Lawmaker Adrian Pedro] Ho wrote to the LCSD this month asking for a meeting to explore ways that surfers could practise without the fear of being prosecuted after a 10-year-old, who learned at Big Wave Bay, joined the Swiss national team because there was no way for him to progress further in the city.

In contrast, China had its first Olympic surfer ever at this year’s Summer Games, with 15-year-old Yang Siqi reaching the women’s round of 16 in Tahiti.

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While we’re waiting for the HK47 sentencing starting tomorrow…

…a Standard op-ed from last week. The author argues that prison sentences for landlords who fail to upgrade subdivided apartments would be excessive…

The ugly truth is that all possible solutions to this problem are tricky and contentious, not least because many wealthy and well-known Hongkongers have added to their fortunes by harvesting the very high yields of such flats…

The government’s proposed new policy will force landlords to upgrade their subdivided flats and it is understandable that the penalties for failing to do so will be harsh.

But the suggestion that offenders could be sentenced to up to three years in prison does seem draconian. After all, if the government had built sufficient public housing in the first place, there would never have been a demand for subdivided flats.

…subdivided flats were a free-market response to a severe shortage of housing for the poor and the downright indigent.

Without them, a large number of poor would have been forced to sleep outdoors.

(How does the involvement of ‘wealthy and well-known’ people make everything more ‘tricky and contentious’ exactly?)

If landlords’ negligence leads to fire hazards and fatalities, a prison sentence does not seem unreasonable. But he is basically right in saying that landlords did not create this problem. So who did?

The root cause of this shameful treatment was a brazen and calculated policy by the British to restrict the supply of land and drive up prices to a point where the poor could not afford a home.

This is a ‘brazen and calculated’ attempt to rewrite history. First of all, the colonial era ended 27 years ago. Post-1997 administrations have had ample time to ensure a proper supply of housing. Indeed, the colonial governments of the 1950s-90s built one new town – each housing several hundred thousand people – per decade in Tuen Mun, Shatin, Tin Shui Wai, etc. They did so thanks to a policy of ensuring a sufficient land supply. 

The rot set in following the signing of the Joint Declaration in the mid-80s, when Beijing officials demanded that the colonial government tightly restrict land sales. That triggered a huge build-up of fiscal reserves and a property bubble that exploded after the handover during the Asian financial crisis. After Tung Chee-hwa shelved his plan to resume adequate supply, subsequent administrations continued to restrict land sales and pushed housing prices back up to absurd levels. Today’s problem is strictly a post-handover one. And, as the author concludes, ‘policies continue to favor developers’.

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Your tax dollars at work, again

From HKFP

The Hong Kong government has given new identification numbers to lamp posts that inadvertently referenced the date of the Tiananmen crackdown, with the numbers “8964” and “6489” erased in favour of new codes.

Article includes a real, non-stock-photo, non-AI, pic of an actual worker spray-painting a new number on a tall item of street furniture in sunny downtown Tseung Kwan O.

Fortunately, only four-digit versions of the offending date are affected, otherwise every lamp post, vehicle, ID card, etc with the number 64 on them would get spray-painted, along with everyone born in 1960, the famous Beatles song, and those 1964 wines – notably Bordeaux from St Emilion or Pomerol. 

And a man has been charged after a sports event in June when…

…officers witnessed someone who turned their back to the field and did not stand for the entirety of China’s national anthem. Local media reported at the time that some plainclothes police officers were observing spectators and filming them as the March of the Volunteers was played to the stadium.

A couple of little items from the weekend…

A paragraph from Carl Sagan in a 1995 book predicting today’s world of anti-science idiocy. It’s so prescient (as the poster puts it) that it could almost be a fake, except it’s in Sagan’s unmistakable voice.

The Economist interviews former US and foreign officials and passes on guidance on getting on with Donald Trump…

…the usual wisdom on how to handle Mr Trump could double up as advice on hosting a toddler’s birthday party, with its emphasis on lavish presents, easy-to-eat food and unlimited praise.

…Mr Trump admires ancient bloodlines…

…flattery can make Mr Trump receptive to a leader’s words, but only if he also thinks that leader strong. 

…There is agreement that Mr Trump has a short attention span and does not read his briefings. He is a bully, arguing with the help of made-up facts and daring foreign leaders to contradict him. “Please don’t, don’t be patronising,” was the heartfelt advice that a senior American diplomat offered allied governments on handling Mr Trump, before a G7 summit. 

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Does anyone watch TV(B) anymore?

Lingua Sinica on the decline of TVB – which you may or may not see as an allegory of the whole of Hong Kong.

…In the “golden decade” of Hong Kong pop culture in the 1980s — when a small British colony became the continent’s biggest cultural exporter — “TVB” was as synonymous with local soft power as the name of any Cantopop superstar.

…TVB, today, is the city’s least-trusted source of news on TV. So much of the public has turned against the station that consumer boycotts nearly brought it to its knees, prompting official intervention that condemned boycotts as a dangerous form of anti-government resistance. Even its once-beloved dramas have become the butts of jokes. Faced with financial losses year-on-year and bubbling hostility at home…

…Following [censorship of footage of police beating Ken Tsang in 2014], TVB … saw an exodus of staff. Since then, TVB seems to have become more selective in its hiring. Current staff include an anchor and sub-editor from Russian state news agency Sputnik and a senior sub-editor from the state-run Ta Kung Wen Wei Media Group. The risks of another walkout over self-censorship are low.

…despite being [protected from competition in the free-to-air] local market, TVB is somehow still losing viewers and hemorrhaging money. In their latest annual report for 2023, the broadcaster was a jaw-dropping HK$838,169,000 in the red — their sixth consecutive year of deepening losses.

From the Standard, another sign of a changing Hong Kong…

A 57-year-old handyman has been denied bail after being arrested and charged by national security police for publishing over 100 seditious posts on social media, including calling the Hong Kong administration a dictatorship.

Chow Kim-ho, a part-time venue handyman and a former member of the pro-democracy party League of Social Democrats, was charged yesterday with one count of knowingly publishing content with seditious intention under the national security ordinance.

No plea was taken but national security judge, West Kowloon court chief magistrate Victor So Wai-tak, denied him bail. Chow was remanded until his next court appearance on December 30.

Among the allegedly seditious content was references to ‘revolution’. Irony time: last October 1 was the 75th anniversary of what?

Can you also be arrested for suggesting that testing Japanese seafood and other products for radiation has been a wasteful performance?

Over 100,000 samples of Japanese food imports tested by the Hong Kong government over 447 days for radiation, and unsurprisingly not a single item exceeded WHO-recommended levels. A policy that was never based on science, but on politics and nationalist sentiment against Japan

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China worries about Trump

Three pieces that assume Donald Trump really will erect serious barriers to Chinese exports. (In other words, any attempts to manipulate him will fail.) The irony is that it would ultimately be good for the people of China – and the whole global economy – if the CCP leadership were forced to focus on demand-side reforms.

An SCMP op-ed – like hundreds in the paper and elsewhere over the years – hints at the demise of the US dollar… 

Ever since the US dollar cemented its role as the backbone of the global financial system following the second world war, it has been a weapon of choice for American presidents waging economic warfare.

But as the United States’ use of sanctions has proliferated in recent years, concerns have grown in China and elsewhere over whether the US dollar can remain a safe haven currency.

The theoretical ability of the US to impose sanctions – by freezing China’s dollar assets – is not something evil Americans have contrived, but a by-product of other countries’ behaviour. They could accumulate fewer surpluses, or park the wealth elsewhere if they wanted.

Michael Pettis responds

…the problem for China isn’t whether or not it should continue holding most of its foreign assets in the US. It made the decision to reduce its dollar holdings long ago (probably in 2008-09), but that decision is proving impossible to execute.

That’s because switching out of dollars is only half the deal. The other half requires switching into something else, and what else is there? They can’t buy RMB assets, because that would cause the RMB to soar and China’s trade surplus to collapse.

They can try to buy yen, but the Japanese government would be furious once the trade impact were felt. The same is true of the euro, sterling, and Aussie and Canadian dollars. No one besides the US has shown itself willing or able to run the corresponding deficits.

They can try to invest in developing countries, but since 2016, when Venezuela showed them just how risky that can be, they have been reducing their investment in the developing world. At any rate the developing world simply cannot absorb that level of inflow.

The problem, in other words, is not whether or not they like holding dollars. The problem is that if the economy is heavily dependent on running large trade surpluses, what assets besides US assets can they acquire in exchange for those surpluses?

It is Beijing’s decision (as it is with Berlin, Tokyo, and others) to suppress domestic consumption in order to achieve big trade surpluses. Which brings us to George Magnus in The Wire China on the possible impact of Donald Trump’s policies on China…

If Trump’s tariff proposals, and other possible controls on goods, are implemented, they could clip at least 0.5-0.75 percentage points off Chinese economic growth in the first year initially, and go on to accentuate the decline in supply chain concentration on the mainland. Beijing is likely to respond more aggressively than the tit-for-tat measures it took in 2017-18. It could allow its currency to depreciate, impose sanctions on key American companies, tighten access to or ban the sale of critical raw materials, and emphasize its already uniquely substantial industrial policies. 

All of these could damage the US to varying degrees, but the first and last in particular would also compound China’s own economic problems. The thing is, without the US market, China is an overbuilt factory with far too few customers (especially if other countries erect trade barriers of their own as all this happens). As with Beijing’s need to buy up offshore assets, China needs the US more than the US needs China. 

Back at the SCMP, Chinese diplomats and ‘experts’ urge Brussels and Beijing to improve relations…

“No one wants to return to the law of the jungle, no one wants to go back to the era of confrontation and the Cold War, and no one wants to return to unilateral hegemony. This is the backdrop that China-EU relations are facing,” [Foreign Ministry deputy Europe head Cao Lai] said.

If China seriously thinks it can enlist Europe to create a bloc to challenge US protectionism, it is either audacious or plain naive. While some European companies do well in China, most of the continent would probably be better off joining the US in pressuring Beijing to get real about its massive economic imbalances. (Let alone China’s role in supporting Putin in Ukraine.)

Beijing’s immediate quandary: how should it handle Marco Rubio, Trump’s likely nominee for Secretary of State? In 2020, China’s government banned the Florida Senator from visiting the country as part of sanctions after he supported Uighur and Hong Kong activists. Awkward.

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HK loses another part of history

Participants in the Hong Kong Tycoon Demise Stakes have been losing money every year since 2020, when 98-year-old Stanley Ho died amid unseemly wives-and-kids bickering. Madam Kwok Kwong Siu-hing carries on as Sun Hung Kai matriarch at the age of 94. Henderson Land’s Lee Shau Kee is a sprightly 96, no doubt energized by the company of his all-male motherless triplet grandchildren. And Superman Li Ka-shing maintains his title as the city’s richest man also at 96. And people say those human-placenta injections don’t work.

But now Lui Che-woo has passed away – last Thursday, it seems – at the age of 95. Best known for his cloth cap, cheeky grin, Prize for World Civilization and heart of gold

Expect renewed interest in the demise pool: as statisticians like to point out, random events tend to occur in clusters.

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HK’s wheels of justice

HKFP op-ed on the incredibly slow pace at which the legal system is dealing with people arrested five years ago…

According to the latest figures, of the 10,279 people arrested [following the 2019 protests], 2,974 had been or were being processed in September, leaving about 7,000 still awaiting a decision.

… the principle is that defendants are entitled – i.e. not allowed to hope for, but entitled – to a speedy trial unless there are good reasons for delay and the case is so important that a bad trial is better than no trial at all. Otherwise the remedy is, and should be, to drop the case altogether.

If the government cannot bring itself to stop the flow of cases and leave some pounds of flesh uncollected, then there really needs to be some serious thought about how we can stop the whole saga from running uncontrollably into the next decade.

Presumably, if any of these people were suspected of a serious crime, the cops, prosecutors and courts would have dealt with them by now. If this isn’t the case, the obvious thing to do with such a huge backlog is (as the article says) drop the whole lot. That this isn’t happening suggests that either: someone wants a years-long succession of prosecutions dating back to 2019 to maintain an atmosphere of fear among anyone thinking of protesting; or someone is terrified of being accused by higher powers of being soft on evil protesters if they scrap the cases.

(On a not-unrelated note, the Justice Secretary floats the idea of reforms to the jury system, after a panel found six people not guilty in the city’s first anti-terrorism trial in August.)

The Diplomat on Hong Kong’s NatSec campaign in international cyberspace… 

…there is no slowdown in sight regarding digital rights violations by the PRC or Hong Kong authorities. Just one day after the report was launched in Brussels, the media reported that PRC state-sponsored hackers are using legitimate VPNs to target a growing list of victim networks in the EU. This follows similar cyberattacks targeting the EU, including those by APT31, a Chinese state-affiliated organization, against more than 400 unique accounts connected to the Inter-Parliamentary Alliance on China (IPAC) in January 2021.

Additionally, the Hong Kong government proposed the Protection of Critical Infrastructure (Critical Computer System) Bill in July 2024. The bill is intended to protect Hong Kong’s critical infrastructure against cyberattacks, but has already been criticized for giving the “authorities overly broad powers that could threaten the integrity of service providers and rock confidence in the city’s digital economy.” U.S. companies have also pointed out that certain parts of the legislation could allow the Hong Kong government “unusual” access to their computer systems.

Meanwhile, RTHK comes up with the slightly subversive headline ‘Make future shoebox homes bigger’…

A community group has suggested that future housing units replacing subdivided homes should be larger than the minimum size proposed by the government.

In his Policy Address in October, Chief Executive John Lee outlined plans to eradicate substandard subdivided units and introduce “basic housing units”. The government said each unit must be no less than 8 square metres, or 86 square feet, and have an individual toilet and at least one window.

Sze Lai-shan, deputy director of the Society for Community Organisation (SoCo), said on Sunday officials should consider adding 5.5 square metres for each additional resident into the basic housing unit requirements, to ensure a suitable environment for families.

“If no one cares how many members are in 8 square metres, then it could be three or four people in 8 square metres …” Sze said.

Who thought up 86 sq ft as a suitable size for homes? What were they thinking?

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More legislators’ brainwaves

Following the success of the ‘pictures of babies in civil service offices’ idea, lawmakers come up with new exciting suggestions: some all-patriots are proposing that young people should be able to draw on their MPF funds for down payments on overpriced tiny apartments. The idea was floated back in 2017. Officials were not keen then, not least because it would simply push the cost of supply-limited homes even higher. But maybe they would find that attractive now. Developers would love it. The MPF fund managers would hate it. So for the rest of us – mixed feelings.

From LinguaSinica, more on Beijing-backed newspapers’ criticism of Johnnie To…

“Film censorship is a common practice in many countries,” Ta Kung Pao wrote, defending the growing censorship regime that has seen numerous films banned from public screening since Beijing imposed a national security law on the city in 2020. On Monday, its sister newspaper Wen Wei Po (文匯報) interviewed the chairman of the Hong Kong Motion Picture Industry Association (MPIA), who told them that the industry’s recent downturn had nothing to do with censorship. “Those who make normal films won’t feel any restrictions,” he said, “only those that badmouth Hong Kong will say there’s no freedom of expression.” The MPIA, as a litmus test of their loyalties, earlier warned its members to “think twice” before attending Taiwan’s Golden Horse film awards.

The solution to To’s troubles? It’s simple, according to the Ta Kung Pao and Wen Wei Po: produce movies that the government would like to see. “The film he should have made is The Gangster Jimmy Lai!” (黑社會之肥佬黎) they suggest, referring to the founder of the pro-democracy Apple Daily (蘋果日報). Lai has been in jail awaiting trial on national security charges since 2020, while his newspaper was shut down by authorities the following year.

Also in the newsletter – for those who want to keep up with these things – lots on the latest ‘Several Somethings’…

The “Two Creates” — referring, respectively, to “creative transformation and innovative (creative) development” (创造性转化和创新性发展) — are the means by which China’s culture has endured for thousands of years. It is through these “Two Creates” that traditional Chinese culture is still around to serve as the “soul and root” and realize the Two Combines in the New Era ushered in by Xi Jinping.

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