SinoInsight 1
The CCP has been steadily tightening its grip over Hong Kong in recent weeks. Meanwhile, Xi Jinping continues to reshuffle key personnel in the Hong Kong and Macau apparatus.
Feb. 9
Hong Kong’s High Court denied bail to Jimmy Lai, the founder of Apple Daily and a prominent pro-democracy activist. Lai and other Hong Kong pro-democracy activists were earlier arrested on national security grounds.
Feb. 12
The Hong Kong Bar Association (HKBA) submitted a paper to the Legislative Council expressing concern over a January proposal. The proposal in contention would allow the city’s immigration director to bar individuals from exiting Hong Kong, bypassing the court. “If a new power to prevent Hong Kong residents and others from leaving the region is to be conferred… It should be for the courts, not the director, to decide when it is necessary and proportionate to impose a travel ban,” the HKBA wrote.
Feb. 13
According to Hong Kong and Western media reports, the city’s Joint Financial Intelligence Unit (money laundering watchdog) recently drafted a proposal to more stringently probe “politically exposed persons” (PEPs), their family, and their confidants who are based “outside Hong Kong.” The phrase “outside Hong Kong” indicates that even mainland officials or businesspeople will be subjected to Hong Kong government investigations; previously, the Hong Kong government would use the phrase “outside the People’s Republic of China” to exempt mainlanders from its external probes.
Additionally, the Hong Kong government concluded consultations with its financial and legal services industries on money laundering changes at the end of January. The Hong Kong government plans to adhere to the recommendations of the Financial Action Task Force, a global anti-money laundering agency.
Hong Kong is the largest recipient of illegal capital outflows from the mainland. Also, CCP officials, their family members, and their “white gloves” (bagmen) are known to launder dirty cash in Hong Kong. The Hong Kong government’s latest move appears to be partly an effort to clamp down on corruption in the PRC.
Feb. 18
Wang Songmiao, director of the Supreme People’s Procuratorate General Office and information office, was transferred to the PRC’s Hong Kong Liaison Office to serve as its secretary-general.
Wang, 53, spent most of his career in the PRC procuratorate system doing propaganda work, and has no prior work experience in the PRC’s Hong Kong and Macau apparatus. From 1991 to 2013, Wang held a number of positions (regular official to chief editor) in the Supreme People’s Procuratorate’s newspaper, the “Procuratorate Daily.” In 2013, Wang was appointed head of the Supreme People’s Procuratorate’s planning, financial, and equipment bureau. In January 2016, he became director of the Supreme People’s Procuratorate General Office and information office, as well as information office spokesperson.
Feb. 19
1. State mouthpiece Xinhua published an interview with Renmin University law professor and Basic Law Committee member Han Dayuan. Han claimed the unrest in Hong Kong in recent years is attributed to authorities who failed to ensure that “patriots” were governing the city. “If an election was insecure, it would not only affect the operation of the country’s political system, but also pose a risk to the country’s overall security,” Han said.
On the same day, Tam Yiu-chung, Hong Kong’s delegate on the National People’s Congress Standing Committee, published an article calling for political reform in the territory. Tam also urged the NPC to resolve problems that Hong Kong cannot handle alone.
2. The Hong Kong government called for tighter supervision of city broadcaster RTHK by government-appointed advisers. Also, Voice of America reported that RTHK employees were given until Thursday to sign an oath of loyalty to the Hong Kong government. This follows the Hong Kong Civil Service Bureau’s effort in January to require all Hong Kong civil servants to pledge their allegiance to the government.
Last November, RTHK producer Choy Yuk-ling was arrested on grounds that she had violated regulations in using a government database in conducting research for a documentary. Choy likely attracted scrutiny after producing an award-winning program investigating police behavior during the 2019 pro-democracy protests. Meanwhile, RTHK anchor Nabela Qoser had her civil service contract terminated in January over a complaint for rigorously questioning government officials.
Feb. 21
1. According to Hong Kong media reports, a large number of Hong Kong civil servants from the city’s social welfare department, health department, fire department, and housing department have resigned en masse in protest of the demand that they swear an oath of allegiance to the government. The housing department saw 35 civil servants withdraw in January, with seven outright resignations, 27 “retirements,” and one citing “other” reasons for departure. Earlier news reports noted over 80 civil servants in the health department resigned in the past three months, while at least eight civil servants departed the social welfare department in January.
The Hong Kong Federation of Civil Service Unions told local media that the actual number of resignations during this period will only be known in March or April because civil servants are required to give three-months notice before quitting. On Feb. 17, Hong Kong civil service secretary Patrick Nip said that data on civil servants who refuse to swear government allegiance oaths will be made available in early March.
2. According to recent data released by the Hong Kong government, the city’s population decreased year-on-year by 0.6 percent to 7.474 million in 2020. Net emigration from Hong Kong in 2020 hit a 35-year high at 39,800, topping the last big emigration wave (23,700) in 1989 that was triggered by the Tiananmen Square Massacre.
OUR TAKE
1. The CCP’s growing encroachment into Hong Kong appears to be a driving factor behind increasing net emigration from Hong Kong in the last five years (ranging from 3,100 to 25,800 per year). Apprehension over whether the Biden-Harris administration will continue the uphold Trump administration’s tough China policy and effectively keep the CCP in check is likely another reason for the people of Hong Kong to vote with their feet by withdrawing their money; Hong Kong dollar deposits fell HK$1.07 trillion (6.8 percent) to HK$14.65 trillion in November 2020.
Hong Kong’s population could shrink steeply in the near future with the United Kingdom launching a new immigration program to admit BNO passport holders in Hong Kong. Over 300,000 Hongkongers could relocate to Britain under the new BNO program. Meanwhile, the city will likely only gain immigrants from the mainland. In other words, the overall impact of the CCP’s recent effort to tighten control over Hong Kong could be steeper and more far-reaching population-wise than the impact of the 1997 Sino-British handover.
2. The enactment of the National Security Law in Hong Kong inspired the city’s civil servants to leave government.
On Nov. 30, Hong Kong Economic Journal reported that at least four directorate-level civil servants (highest D4 rank) opted to quit, including a deputy secretary for constitutional and mainland affairs and a principal assistant secretary for home affairs.
An Apple Daily report found that as of Nov. 24, at least 14 Hong Kong administrative officers (AOs) retired, including 12 directorate-level AOs. Another 12 AOs left for other reasons, including resignations and transfers to other branches of government; five of the 12 were at the directorate-level. Also, during the same period, at least 23 executive officers (EOs) retired while another 54 EOs either resigned or were transferred out.
Xi and the CCP’s recent demands for loyalty in the Hong Kong government ranks will likely inspire a fair number of civil servants to quit government work. However, the Hong Kong government will unlikely be “hollowed out” in the lower and middle ranks because those civil servants may not have the financial means or qualifications to easily change jobs; those with professional qualifications may be less constrained.
3. In recent years, Xi Jinping has transferred several officials from outside the Hong Kong and Macau affairs apparatus into key positions inside the apparatus, including Liaison Office director Luo Huining and new Liaison Office secretary-general Wang Songmiao. Given that Hong Kong is a key site of factional struggle and a potential “counter-revolutionary base” from which “external forces” can undermine the regime, Xi has good reason to stick to his personnel reshuffle “formula” for key positions instead of relying on experienced Hong Kong and Macau apparatus officials.
Officials “parachuted” into the Hong Kong and Macau apparatus from other areas of government are more inclined to follow Xi Jinping’s orders, and correctly communicate and implement his policies in Hong Kong. In contrast, officials who spent their careers in the Hong Kong and Macau apparatus have a vested interest in preserving established interests of local factional and institutional networks (including the Jiang Zemin faction). By swapping experience for loyalty, Xi seeks to lower his political risks in Hong Kong and deny his factional rivals opportunities to exploit crises in the territory.
The Hong Kong government’s effort to crackdown on mainland money laundering in the city is also likely linked with Xi’s determination to dominate factional opponents and eliminate political risks in the lead up to the 20th Party Congress in 2022, where he is expected to push for a norm-breaking third term in office.
4. From Xi’s perspective, the immediate downsides of tightening control over Hong Kong (shrinking population, capital outflows, etc.) are worth the upsides of securing the regime from external threats and domestic foes.
Xi and the CCP are also likely betting that they can erode Hong Kong’s autonomy without repercussions because time and momentum appear to be on the PRC’s side. After the election of Joe Biden in November, PRC scholar Di Dongsheng bragged about the CCP’s successful capture of American elites, including the 46th U.S. president via his son Hunter. The slew of socialist policies rolled out by the Biden-Harris administration in past weeks will accelerate the “steady, irreversible structural decline” that the CCP believes is already underway in the United States. An America unwilling to stand up to the CCP over Hong Kong (at least from Xi’s perspective) means less pressure for a regime struggling with a “perfect storm” of problems, especially when U.S. allies and partners look to Washington for leadership in confronting the “China challenge.”
The influx of foreign money into China despite rising Sino-U.S. tensions, as well as the global economic recession caused by the coronavirus pandemic, will convince Xi and the CCP that the U.S. and other nations are unwilling to and incapable of punishing the PRC over its malign behavior in Hong Kong and elsewhere. China’s (definitely fraudulent) 2.3 percent GDP growth makes it the envy of many countries, who saw negative growth due to the pandemic. The Chinese economy is projected to overtake the U.S. by 2028, two years sooner than previous projections. Meanwhile, U.S. investors held $1.1 trillion in equity and $100 billion in debt issued by Chinese companies at the end of 2020, according to a Rhodium Group report. Xi and the CCP will anticipate heightened Sino-U.S. financial coupling giving Washington pause in waging “strategic competition” against Beijing, and leave greater space for Communist China to pursue global hegemony. The CCP will take advantage of U.S. and Western weakness by making inroads in Southeast Asia first; based on our preliminary observations, the PRC appears to have a hand in the recent military coup in Myanmar.
SinoInsight 2
On Feb. 20, the CCP held a symposium in the Great Hall of the People in Beijing to commemorate the 100th anniversary of the birth of former Party Chairman Hua Guofeng. Central Organization Department head Chen Xi chaired the symposium, attended by high-ranking officials like Central Military Commission vice chairman Zhang Youxia, PRC vice premier Sun Chunlan, and Politburo Standing Committee members Han Zheng and Wang Huning.
In his speech at the symposium, Wang Huning, the Politburo Standing Committee member overseeing propaganda, praised Hua Guofeng highly after giving a brief overview of his life and deeds. Hua had played a “decisive role” during an “important juncture of historical development” after Mao Zedong’s death, “smashing the Gang of Four and saving the Party,” according to Wang.
Wang implored CCP officials to learn from Hua Guofeng, who showed “resolute Party nature and loyalty to the Party.” Wang added that Hua adhered to “Party nature inside the Party” and not intra-Party factionalism, and therefore, “Party members and cadres should follow the requirements of General Secretary Xi Jinping, be conscious of the ‘four consciousnesses,’ strengthen the ‘four self-confidences,’ achieve the “two safeguards,’ continuously improve political judgement, political understanding, and political implementation, and always maintain a high degree of consistency with the ideological and political actions of the Party Central with Comrade Xi Jinping as the core.”
Wang Huning said that to commemorate Hua Guofeng is to learn from the latter in “serving the people” and being “uncorrupt and self-disciplined.” Therefore, “Party members and cadres should adhere to the requirements of General Secretary Xi Jinping and persevere in self-cultivation and self-discipline.”
Mao Xinyu, the grandson of Mao Zedong, and Liu Yuan, the son of former CCP president Liu Shaoqi, attended the Hua Guofeng symposium, according to state broadcaster CCTV’s “Xinwen Lianbo” evening program.
OUR TAKE
1. The Feb. 20 symposium is the most high profile commemoration of Hua Guofeng since his death in 2008. Commemorating or even reporting on Hua is unusual in the CCP because he was the loser in a factional struggle against Deng Xiaoping. After essentially handing over paramount leadership to Deng at the 11th Party Congress in 1981, Hua Guofeng gradually receded to the background of CCP elite politics. Although Hua remained a Central Committee member, he stopped attending Central Committee meetings starting 1997, citing “health” reasons for his absence.
Hua Guofeng passed away at the age of 87 on Aug. 20, 2008. After his death, Xinhua published a positive evaluation of Hua (“A Life Serving the People Wholeheartedly”), while then-Party boss Hu Jintao and all members of the Politburo Standing Committee attended Hua’s funeral—glowing, “you know what I mean” (你懂的) tributes for a factional struggle loser and long sidelined former Party leader.
2. During Xi Jinping’s time in office, Hua Guofeng has been celebrated at least twice in a relatively prominent way. In August 2014, Hua was depicted for the first time in film and television media in a 48-episode television drama commemorating the 110th anniversary of Deng Xiaoping’s birth. And on Feb. 20, the Party held a high-profile symposium to mark his 1o0th birthday.
There are several ways to read Xi’s embrace of Hua Guofeng, and it is possible that the following interpretations below are simultaneously valid.
At a surface level, it makes sense for Xi to venerate Hua, the only other CCP “strongman” aside from Mao, a former “people’s leader,” Party “fundamentalist” (cadres with rose-tinted and ideological views about the PRC’s early days and good relations with the Chinese people), and, in Wang Huning’s words, “uncorrupt and self-disciplined.” Put another way, Hua Guofeng is being “remembered” as the proto-Xi Jinping, the image of a “selfless” founding CCP revolutionary who put the people’s interests first and was loyal to the Party. Thus, “rehabilitating” Hua makes sense for Xi, who once cited “historical nihilism,” or the “revisionist” questioning of past leaders like Lenin and Stalin, as a reason for the Soviet Union’s downfall. Viewed in this light, Xi’s commemoration of Hua is yet another power consolidation/personality cult-building measure.
In taking the Xi-Hua juxtaposition further, Wang Huning is telling Party members that Xi Jinping, like Hua Guofeng, has also played a “decisive role” during an “important juncture of historical development” through the anti-corruption campaign and other policies. Just like how Hua “served the people” by “smashing the Gang of Four and saving the Party,” Xi is purging the CCP of corrupt officials “in the name of the people” to save the regime. Officials are encouraged to “persevere in self-cultivation and self-discipline,” and stay loyal to the Party and Xi Jinping; otherwise, they too will be “smashed” like how Hua ousted the Gang of Four, the rogue CCP faction led by Mao’s wife Jiang Qing.
It is also possible to read Xi’s “rehabilitation” of Hua, a former high-ranking CCP cadre that the Party has shunned for decades, as a subtle attack against his factional rivals. Since taking office, Xi has broken some of Deng Xiaoping and Jiang Zemin’s political taboos, including allowing reporting and commemoration of previously “political sensitive” characters like Hua Guofeng (Deng’s enemy), Hu Yaobang (former Party boss and a rival of Jiang), and Gao Gang (former Party vice chairman and Mao’s enemy). Seen from this angle, Xi Jinping is signaling to previously sidelined cadres and princelings that they have his support, while informing his political enemies that they too will be “smashed” like the Gang of Four if they dare to challenge him during this “historical juncture.”
Finally, an unorthodox, but not improbable, reading of Xi commemorating Hua concerns a 2001 report in Asahi Shimbun that the latter had in fact quit the Party. When a Japanese reporter asked PRC foreign ministry spokesman Zhu Bangzao whether “Hua Guofeng asked to quit the Party” on Nov. 6, 2001, he replied, “This question is not within the scope of what I can answer. Please don’t post such questions during foreign ministry press conferences in future.” Zhu’s reply is unlikely a roundabout “no” as the CCP would outright say no if that was the case. It is more likely that Zhu gave a tacit “you know what I mean” acknowledgment that there is a kernel of truth in the report of Hua renouncing the CCP. If the latter interpretation hews closer to reality, then there is a possibility Xi has laid the groundwork for a scenario where he has no choice but to dissolve the Party.
