Taming the Dragon: Britain's Policy Options in Hong Kong

By Peter Wollweber

Much of the past year in foreign affairs has been dominated by ongoing protests around Beijing’s role in the government of Hong Kong. On its handover to China in 1997, the former British colony was issued with a set of safeguards promising a high level of independence from the mainland. It became one of several Special Administrative Regions (SARs) to hold these rights. The extension of central authority through a controversial bill allowing criminals to be tried in mainland China sparked a surge of protests asserting Hong Kong’s status, resulting in the legislation being indefinitely postponed. Recent days, however, have seen the proposal of a new law that would, if implemented, impose a state of martial law in the territory, under which it would be a criminal act to engage in anything deemed subversion of Beijing’s authority. Britain’s central role in the original delineation of Hong Kong as a SAR has led to mounting calls for a strong diplomatic response by the British government. 

The question is what form this response could take. There are, in essence, two potential channels: political and economic countermeasures. The UK’s direct political involvement in Hong Kong is limited, bar one crucial issue. Any citizen born before the handover remains eligible to apply for a British National (Overseas) passport, which would entitle the bearer to travel visa-free to the UK for a period of up to six months. The document does not, however, bring the benefits of full citizenship, such as access to the state welfare system or the right to remain in the UK indefinitely. Foreign Secretary Dominic Raab has discussed potential changes to these restrictions in light of the proposed security measures. The Foreign and Commonwealth Office (FCO) has proposed, in the instance that China was to implement its legislation, an extension of the six-month period to one year, with the potential to apply for permanent residency. This move, however, has been criticised for a number of reasons. The first is that few Hong King residents hold a BNO passport, meaning the real impact of any move would be limited, and the second is that the demographic actively involved in protests is heavily weighted towards those born after 1997, and therefore ineligible to apply. Realistically, the UK response could only be scaled up by either altering the status of Hong Kong BNO passport holders resident in the UK, making it considerably easier to gain either citizenship or extended residence beyond one year, or by controversially attempting to extend the right of residency to younger Hong Kong citizens not included in the 1997 provision. Either move, particularly the latter, would likely draw strong criticism from China, which argues the Hong Kong issue is internal and rejects threats of international action as unwarranted interference in domestic Chinese politics. The UK government’s current stance, however, has been decried by some as purely symbolic with little diplomatic clout. Raab has suggested that the extension of residency to 12 months ‘would itself provide a pathway to future citizenship’, making the future of emigrants uncertain at best. 

A second possible response is along economic lines, and would reflect the response of the Trump administration. In 1992 the US granted Hong Kong ‘special status’, meaning the territory, much of whose trade relies on resold goods, gained significant import concessions. Last week, in response to the Chinese government measures, that privilege was revoked. The impact of this will also not be limited to Hong Kong itself. Due to the special status, the port has long acted as a major import centre for mainland Chinese businesses, many of which will now suffer. Hong Kong was already falling into recession in 2019 with an estimated 1.4% contraction, and cutting off its economic lifelines will certainly have an impact beyond the territory itself. The UK is also in a position to impose economic sanctions were it deemed a beneficial route as Hong Kong’s economy is disproportionately reliant on financial services. The UK’s status as one of the key global players in this sector means it could potentially inflict wounding retaliatory sanctions in response to the new security measures. This route, however, is also fraught with risk. It is worth considering how far economic sanctions would encourage Beijing to move to a more laissez-faire position, or whether targeting the area’s key industries may cause it to become more economically dependent on mainland China. It could be argued that economic sanctions in the style of the Trump administration are a heavy-handed response aligning more closely with US foreign policy, in which anti-China rhetoric is already heavily present, than the UK position. 

The question of how to respond to events in Hong Kong is a difficult one for the UK government. As a state with close historic and diplomatic ties to Hong Kong, it is often argued that its role in the 1997 handover compels it to uphold those provisions that guarantee the territory’s SAR status. In real terms, however, the options available to British policymakers are limited. An economic response, whilst highly likely to be damaging, risks having an adverse political effect and failing to directly address the political issue. It is also possible that, given the high political stakes of the Hong Kong issue in China, it could simply develop into an exchange of international sanctions, which at a time of global recession, as well as a period when the UK is seeking to establish new and profitable global trade deals, could do more harm then good. The political approach therefore seems a more reasonable option. Not only extending the period that BNO passport holders can remain in the UK but making it easier for them to obtain permanent resident status would uphold the UK’s enduring commitment to Hong Kong’s sovereignty, with the potential to take a more radical route in offering the same status to younger Hong Kong citizens. This direction would inevitably lead to greater political conflict with the Chinese government, but it could perhaps be hoped that such measures might accompany renewed efforts for international dialogue, in which the UK, as a key economic and political stakeholder, should seek to play a part.