New Challenges in the Periphery of China

Over the past several weeks, protestors have occupied streets in Hong Kong in a call for true universal suffrage in the territory. While China’s leaders seem to hope that the crisis will soon resolve itself, this is wishful thinking. The Hong Kong crisis is fueled in part by the interaction of two macro-factors which are beyond China’s control–globalization and localization–and it is merely one manifestation of this looming challenge. Against this bleak backdrop, there is still a way forward for Hong Kong and for China itself.

Globalization has been the dominant trend in the world economy for more than two decades. A major actor in this process is China, both as a market for raw materials and as the supplier of finished goods for overseas markets. But globalization has generated both winners and losers. It has contributed to economic growth in Asia and beyond, it has also created deep concerns among China’s smaller neighbors about increasing economic and political asymmetry. Some groups who have not greatly benefited from socio-economic integration with China have started to resist it, triggering localization movements. As globalization often takes control and decision-making authority away from local communities, actual or potential losers around China’s periphery tend to invoke local identity, autonomy, and protectionism as their response to increasing transnational flows of goods and people. Localization advocates argue for small-scale measures to deal with challenges of income generation and inequality, environmental degradation, education gaps, and public health problems. Localization efforts have been occurring to varying degrees in many areas of China’s periphery, including Hong Kong, Taiwan, Korea, Mongolia, Vietnam, Singapore, Burma, Laos, and China’s inner periphery such as Xinjiang and Tibet.

Hong Kong represents the front line of China-related globalization and localization. Enhanced ties with China have been a bonanza for Hong Kong’s trade, finance, and real estate industries, but economic inequality, the cost of housing, and fear of interference by Beijing have surged. Hong Kong’s protesters desire a proper say in local governance in order to better face these challenges. They want their chief executive to be accountable to the people of Hong Kong, not to Beijing bidding or a handful of pro-Beijing tycoons.

While it is not fair to blame Beijing for all of the problems in Hong Kong, Beijing could be helpful in addressing them by recognizing that a legitimate local government could help to address local problems in a way that the national government can not. Legitimizing the electoral system is by no means a panacea for the problems in Hong Kong, but is an important element of good governance. A Hong Kong chief executive whom a majority of Hong Kong residents view as the best leader, rather than the least objectionable, would be likely to exercise more legitimate, accountable and responsive leadership in tackling the problems arising from the contending forces of globalization and localization.

Beijing could permit more room for free and open elections in Hong Kong. While it may be a difficult step, it is better than other options such as suppression and deadlock. Protracted stalemates will leave the underlying grievances of the protesters untouched and tensions inevitably will flare up again. In a worst-case scenario, use of force to end current or future protests could have catastrophic effects on Hong Kong and on China.

We should accept that China has a right to its own system of government. Nonetheless, a political experiment in Hong Kong would be useful not only for Hong Kong but also for China’s broader, long-term political reform. Hong Kong is an ideal political laboratory for China. It has strong institutions and a strong rule-of-law culture, and Beijing can easily justify its flexible or exceptional approach to Hong Kong through the “one country, two systems” formula. Beijing can control the pace and extent of political reform in the mainland while evaluating the results in Hong Kong. This approach is consistent with the experimentation in economic policy that has been a pervasive feature of China’s economic reform during the post-Mao period.

The Hong Kong problem is the leading edge of an unprecedented challenge to the Chinese leadership: tension between globalization and localization is likely to increase and eventually to manifest inside China. Therefore it is also a great opportunity for China’s long-overdue political reform. It is time for Beijing to come up with far-sighted responses to emerging problems in its periphery, and more free and open elections for Hong Kong is the way to begin.