Critical Issues Confronting China Summary–Beijing Faces Its Periphery: Update on Hong Kong and Taiwan

December 5, 2016
Dr. Richard Bush

Dr. Richard Bush of the Brookings Institution and former Chairman and Managing Director of the American Institute in Taiwan, let the November 30 Critical Issues Confronting China seminar series talk. A summary of his talk follows.

Facing many perennial problems in its periphery, China adopts different approaches to each of them. Whereas China confronts the Tibet and Xinjiang problem through repression and an influx of Han people into the region, the South and East China Sea disputes by testing the tolerance level of other countries, China’s goal for handling the challenges of Hong Kong and Taiwan is to find a feasible institutional formula which simultaneously satisfies Beijing’s desire of maintaining some degree of control and the local people’s wish for unfettered universal suffrage.

The general formula was invented by the paramount Chinese leader, Deng Xiaoping, in the early 1980s and termed "one country, two systems." But the details under this formula are complex and have run into various difficulties in both Hong Kong and Taiwan. Richard Bush, Senior Fellow at the Brookings Institution and former Chairman and Managing Director of the American Institute in Taiwan, explained the background of these challenges and gave an update on the latest development in Beijing’s relationships with these two places.

After Deng Xiaoping came to power in 1978, he announced Beijing’s ultimate objective of uniting Hong Kong, Macau and Taiwan with the mainland, although he was pragmatic enough in practice to subject this objective to a more overarching goal of restoring economic growth and the legitimacy of the communist party in the mainland. He exhibited some patience and flexibility during the negotiations with the British in the 1980s, while holding an unwavering determination of taking over Hong Kong in 1997. Beijing agreed that the Hong Kong Special Administrative Region (HKSAR) be an executive-led autonomy region with a separate political system from the mainland, and that “autonomy” mean “home rule” from Hong Kong by a Hong Kong executive. Moreover, Beijing guaranteed the rule of law and protection of civil and political rights. However, the central government preserved control over who the chief executive would be by having him selected by an election committee whose members were pro-Beijing due to their own economic and political interests. It also dictated that at least half of the seats in the Legislative Council would be picked by special interests. Hence, a hybrid model of generating the chief executive came about: preservation of the rule of law and civil and political rights on the one hand, but preserving control over who would occupy many of the most important positions.

Why did China agree to the rule of law and civil and political rights? During the negotiations in the 1980s, the British convinced Beijing that they were essential for maintaining Hong Kong’s prosperity and capitalist market economy. This concession by China became a "poison pill" to be used by Hong Kong’s democrats later to press their political rights and democratic elections. This is why Hong Kong can continue after 1997 holding an annual vigil for the victims of the June 4th protest of 1989, and maintain a protest culture.

In early 2014, Beijing was willing to move toward the election of the chief executive by universal suffrage instead of the election committee. But it required that the candidates for that election be picked by a nominating committee that would be dominated by pro-Beijing and pro-establishment interests. The pan-democrats feared that this would allow Beijing to screen out candidates it didn’t like, so it mounted a concerted campaign to reform the election mechanism. Then the “umbrella movement” broke out in the fall and blocked three major thoroughfares in the downtown area. Beijing poorly handled its public relations throughout this fraught period. In the spring of 2015, the Hong Kong government, in a legislative draft that fleshed out the details of Beijing’s approach, proposed a two-stage process that would give a centrist democrat the chance not only to be selected as a candidate but also picked as chief executive in a universal-suffrage election. But by that time the mistrust between the pan-democrats and the pro-Beijing faction was so deep that this proposal to move in the right direction was voted down in the Hong Kong legislature.

More recently, a minor Hong Kong book seller, holding a British passport, was arrested in Guangdong in the end of 2015, for selling books denigrating Chinese leaders. It is not clear whether this arrest was under Beijing’s instruction, but Beijing has indicated that such arrests would not happen again. Nonetheless, disproportionate media attention on this incident has placed Beijing in a very negative light. Another incident had to do with some newly-elected legislative council members who changed their oath of affirming Hong Kong as an unalienable part of China upon taking office. Such provocation of Beijing’s sovereignty should be judged by the Hong Kong court system, but Beijing instructed Hong Kong what to do. These incidences have dissipated people’s confidence in Hong Kong’s rule of law and liberal order.

In Taiwan, the Democratic Progressive Party (DPP) won a stunning victory in both the presidency and the legislative Yuan in this spring. This is a clear indication of a changing mainstream view from considering, as of a few years ago, Taiwan’s economic ties with the mainland beneficial to Taiwan to being concerned that Taiwan becomes too dependent economically on the mainland. But Beijing has failed to understand Taiwan’s changing public sentiment, and insists that the new president, Tsai Ing-wen, must explicitly acknowledge the 1992 Consensus and its core connotation, that Taiwan and the mainland belong to the same China, as a pre-condition for normal cross-Strait relations.

While Tsai cannot make this declaration for fear of political suicide, she cannot ignore Beijing’s demand completely either, for her domestic objectives on Taiwan’s economy depend on a reasonable relationship with the mainland. To straddle, she acknowledged the historic 1992 meeting in somewhat ambiguous ways in both a post-election interview and in her inaugural presidential address. But Beijing has yet to show any flexibility with its pre-condition. It seems that Beijing does not want to accommodate her, and continues hoping to deal with the KMT when it returns to power in the future.

To explain the stalemates in Beijing’s relationships with Hong Kong and Taiwan, Bush conjectured three plausible reasons. First, President Xi Jinping, under domestic pressure, feels compelled to take a hard line position. Second, those Chinese who really understand Hong Kong and Taiwan‘s situations don't dare to speak up, and the balance of power in Beijing has shifted to the hardliners, dominated by various security agencies of the central government. Third, Beijing has changed assessment on the threat from both of these places. Chinese hardliners feel that the independence forces along its periphery are becoming stronger and that they must fight back. They’re worried about the possibility of transmitting these places’ demands for unfettered democracy into the mainland. Their best strategy is to thwart this tendency early on before it reaches its full potential, thus intensifying distrust and creating a vicious cycle in these relationships.