What’s happening in Hong Kong?

Written by Tom Whitehead & Luke Paterson

3rd July 2020
Reading time: 12 minutes


The announcement of China’s new national security law for Hong Kong has called into question the “one country, two systems” principle that outlines Hong Kong’s distinct political and judicial autonomy. Furthermore, the legislation undermines many of the civil liberties that Hong Kongers were guaranteed under the Sino-British Joint Declaration. This article aims to provide an overview of the tensions between China and Hong Kong.

Recent shocking announcements have, once again, exploded tensions between the Chinese Communist Party (we’ll refer to as the CCP) and the citizens of Hong Kong. Although this is outside of our realm, we deem the issue, similarly to the Black Lives Matter protests, to be too important to simply ignore! This essay is aimed at anyone wanting to understand what on earth has led to the divisions between Hong Kong and China, whilst simultaneously explaining why we should all be deeply concerned about the developments.

At Economic Discussions we are concerned that people our age in the UK do not seem to be talking about this issue enough, so we wanted to give an overview of the history of Hong Kong and the problems with the adoption of the recent national security law. This article may be longer than most of our other publications, but we argue that it is necessary in order for a suitable understanding of the current situation.

Historical Context

It makes logical sense, before we discuss the measures the CCP has recently introduced, to briefly summarise the history that has provoked today’s tensions.

Hong Kong Island was ceded to the British following the First Opium War in 1842. In the following years, thousands of Chinese migrants fled civil unrest in mainland China and sought settlement in the British colony. Overtime, the poor fishing community transformed into a prosperous capitalistic society. In 1898, Britain gained a 99-year lease over the New Territories in the Hong Kong region. During the Chinese Civil War, more refugees fled to Hong Kong and were followed by even more once the CCP took control over China in 1949. The influx of human capital and foreign direct investment led to Hong Kong becoming one of the first Asian economies to industrialise, and subsequently has become a global financial hub. In summary, Hong Kong developed from a small fishing community to a bustling financial centre (ranked 6th in the world), and is one of the most highly developed regions in the world (4th in the world by the measurement HDI).

As the lease was due to end in 1997, diplomatic negotiations opened between the British and Chinese regarding the future of Hong Kong. These negotiations concluded with the 1984 Sino-British Joint Declaration, which specified that the UK would return Hong Kong to China on the condition that China would guarantee the continuation of Hong Kong’s distinct economic and political systems for at least 50 years after the transfer in 1997. It is clear that the residents of Hong Kong were not convinced that the CCP would guarantee their freedoms. This agreement triggered a wave of mass emigration of Hongkongers, as they feared that China would not respect their civil rights and their distinct rule of law established by the British (over 500,000 Hongkongers left 1987-1996). 

“The current social and economic systems in Hong Kong will remain unchanged, and so will the life-style. Rights and freedoms, including those of the person, of speech, of the press, of assembly, of association, of travel, of movement, of correspondence, of strike, of choice of occupation, of academic research and of religious belief will be ensured by law in the Hong Kong Special Administrative Region. Private property, ownership of enterprises, legitimate right of inheritance and foreign investment will be protected by law.”

(Condition Five of The Sino-British Joint Declaration, 1984).

In 1993, the Hong Kong economy was 27% of the size of the whole Chinese economy – it was a major economic powerhouse. However, overtime, and due largely to China’s economic success, Hong Kong’s economic importance, as a component of China’s output, has diminished. In fact, as of 2019, Hong Kong only contributes to 2.7% of China’s Gross Domestic Product – value of all finished goods and services. This is explained, mainly, through the emergence of megacities in China such as Chongqing, Shanghai, Shenzhen, Beijing, Chengdu and Harbin, who have powered the country’s GDP to $13.6 trillion (World Bank, 2019). It is clear to see the lessening relative importance of Hong Kong, in terms of China’s overall goals, has contributed to China’s willingness to attempt closer integration.

The Hong Kong Basic Law and Democracy

The Hong Kong Basic Law was enacted by the National People’s Congress of China to implement the conditions of the Sino-British Joint Declaration. Many Hongkongers have interpreted the Hong Kong Basic Law as outlining universal suffrage as part of the “one country, two systems” principle, but over the last 20 years this has not been achieved due to significant Beijing influence and a legislative and executive system that is fundamentally skewed towards pro-Beijing interests. 

For example, only half of the Legislative Council (equivalent to the House of Commons) is directly elected, with the other half being elected through functional constituencies with limited electorates (basically it is rigged towards pro-Beijing interests). Article 68 of the Hong Kong Basic Law states the ultimate aim is the election of all the members of the Legislative Council by universal suffrage – it seems clear that the CCP has no intention of allowing this to happen. 

Similarly, Article 45 outlines that the Chief Executive of Hong Kong should be elected via universal suffrage; however, much like Article 68, this has not been achieved. Instead, the Chief Executive is elected by an Election Committee consisting of only 1200 members that are meant to represent Hong Kong. Much criticism has been aimed at this system due to it being skewed towards pro-Beijing and business interests. Furthermore, the Chief Executive has to be officially appointed by the Central People’s Government (meaning mainland China has the final say).

An Overview of Previous Protests

The last 20 years has seen multiple protests across Hong Kong, which have been triggered by various measures that undermine the principles outlined in the Sino-British Joint Declaration and Hong Kong Basic Law. A prominent and famous example of this is the campaign against the introduction of National Education in 2012, with the protesters being led by the teenager Joshua Wong. National Education basically aimed to instill Chinese patriotic values in Hong Kong students, with the aim of weakening the Hong Kong identity in favour of a more Chinese identity focussing on CCP values. The protests resulted in the government announcing that the implementation of National Education would be postponed.

Protests have also been directed towards the issue of democracy and universal suffrage. An example of this is the 2014 democracy protests (commonly known as the Umbrella Movement) against the decision to have a ‘selective pre-screening of candidates’ for the 2017 election of Hong Kong’s chief executive. Essentially, it was caused by a move away from universal suffrage and towards control by the CCP. After nearly 3 months of protests, the movement failed to achieve its aims and the pre-screening of candidates went ahead.

Hong Kong Umbrella movement 2014 | Getty images

Another protest arose from the Hong Kong extradition bill in 2019, which attempted to undermine the Sino-British declaration’s commitment to an independent judicial system. Essentially, the bill was a mechanism for transfers of fugitives not only for Taiwan, but also for Mainland China and Macau. This was deeply concerning for Hong Kong residents as they were at risk of falling victim to mainland China’s socialist legal system rather than Hong Kong’s common law system (implemented by the British) – which, in some cases, leads to significantly harsher sentences. Furthermore, many feared interrogation and torture by the Chinese authorities if the bill was passed. The protesters put forward five demands, including the withdrawal of the bill and the introduction of universal suffrage. Eventually, the bill was withdrawn but the other demands of the protesters were ignored. The 2019 protests were deeply embarrassing for the pro-Beijing executive of Hong Kong and the CCP, which may explain why the national security law was pursued and implemented.

National Security Law

As the 23rd anniversary of Hong Kong’s handover to China loomed, a new 66 article security law came into effect. Ironically, the standing Committee of the National People’s Congress, who unanimously voted for the bill, did not get access to the details of what the law entailed until its enactment. In addition to being passed behind a closed door, the law was not consulted with the city’s local government or legislature – no one in Hong Kong knew what the law would entail until the moment it was implemented!

The law’s main objective is, according to Carrie Lam (Chief Executive of Hong Kong), to “restore stability” and to develop relations “between the central government and Hong Kong” – in other words silence protesters that are resisting the violations of the ‘one country, two systems’ principle. The pro-Beijing camp are concerned with people advocating for Hong Kong’s independence, but the reality is that protesters are only advocating for this because Hong Kong’s autonomy is being eroded and their civil/political liberties are being encroached. 

Carrie Lam, Chief Executive of Hong Kong | Getty images

The law details new punishments for various crimes relating to secession, subversion, terrorism, and collusion with foreign forces (punishable by a minimum sentence of three years, with the maximum sentence being life). At first read, this legislation may not seem particularly concerning; however, a further inspection of the definition of these crimes and the relevant articles of the legislation reveal many worrying aspects. For example, the secession part of the legislation makes it illegal to advocate for Hong Kong independence – indeed, the first arrest under the national security law was of a man who was carrying a Hong Kong independence flag. Zooming into the flag reveals that the words ‘no to’ are written before ‘Hong Kong Independence’, so this will be a true test of how the law is implemented. To put this into perspective, and to help understand the suppressive nature of this law, imagine if the UK Parliament passed an act that criminalised Scottish people for advocating for Scottish independence, or for simply holding up a banner. The national security law essentially takes away the freedom of speech and freedom to protest of Hong Kong residents.

“A man was arrested for holding a #HKIndependence flag in #CausewayBay, Hong Kong, violating the #NationalSecurityLaw” | Hong Kong Police Force Twitter

Article 29 concerns subversion and details how inciting hatred of China’s central government or Hong Kong’s regional government is now punishable by 3 years to life. Once again, in relation to the UK, it would be parallel to someone shouting “Tory scum”, or someone who wrote a book that criticised the British system of government, being thrown into prison. Once again, this exemplifies how freedom of speech is being eroded in Hong Kong. 

It is by no means controversial to legislate against terrorism. However, under the national security law damaging public transport facilities and equipment can be considered terrorism. A frequent method of protesting is to disrupt public transport and it is unclear where the line will be drawn and what is classed as terrorism. This calls into question what kind of protest is legally allowed in the future. 

The act also criminalises collusion with foreign or external forces. Put simply, this means that protestors can no longer legally work with foreign entities to achieve change in Hong Kong. For example, Nathan Law recently testified in the US Congress about the current situation. This could be classified as collusion with foreign forces under the new law. In fact, he has recently announced that he will not be returning to Hong Kong, and this is undoubtedly due to fear of prosecution. 

We have very briefly skimmed over the four main ‘crimes’ that the national security law sets out, but we will now add another reason why this legislation is concerning. It is also detailed that the trials can be held in secret, without a jury, and that the judge will be handpicked by the Chief Executive of Hong Kong (who is inevitably pro-Beijing for reasons we set out earlier). If the particular ‘crimes’ were not concerning enough already, these particular articles of the legislation are very concerning for how the law will be interpreted and applied. These provisions also directly undermine the Sino-British Joint Declaration and Hong Kong Basic Law, which were meant to protect Hong Kong’s distinct political and judicial systems.    

If you were planning on visiting Hong Kong at some point, think again. Article 38 of the Hong Kong security law details how committing acts outside of Hong Kong and China are liable under the law. For example, if you denounce the CCP or advocate for Hong Kong independence and then travel to Hong Kong, you can now be prosecuted by the authorities there. Obviously, only the future will tell whether the law will be applied like this, but the written legislation clearly details that this is possible and therefore everyone should be weary. 


Although this is a longer text than we would normally publish, we believe that this issue deserves attention. From the history of Hong Kong, it is clear why the residents are more closely aligned to values of freedom, democracy, capitalism, and liberty. The Sino-British Joint Declaration attempted to ensure that these values would be respected, that Hong Kong would be autonomous, and that their distinct system would be maintained. However, the last 20 years, and specifically the recent enactment of the national security law, makes clear that mainland China has no intention of allowing Hong Kong the freedom it was promised. We should all be concerned with what is happening in Hong Kong, as it is essentially the last bastion of freedom and capitalism in China. What we in the UK take for granted and enjoy as basic freedom/rights is being eroded by this new law – who knows what steps the CCP will take next. The autonomy of Hong Kong was meant to be respected for at least 50 years – it has only been 23 and many attempts to infringe the agreement have already been pursued. For these reasons, we welcome the UK Government’s announcement that up to 3 million Hong Kong residents will be able to move to the UK. However, a stronger international response is needed to protect the residents of Hong Kong and to condemn the current legislation. Recent history and the lack of a sufficient response makes it seem unfortunately inevitable that ‘one country, two systems’ will not exist for much longer.

Constitutional and Mainland Affairs Bureau, The Joint Declaration
South China Morning Post
BBC News
The Guardian
The New York Times
Hong Kong Free Press
Law of the People’s Republic of China on Safeguarding National Security in the Hong Kong Special Administrative Region (national security law)
Financial Times


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