The proposal for a national security law in Hong Kong was passed in Beijing less than a month ago creating uncertainty for what is to come in the autonomous region.

After being returned to China from the United Kingdom in 1997, Hong Kong was supposed to be ruled under the “One Country, Two Systems” principle.

The law comes after a series of pro-democracy protests which started in March last year. Although the law is still being drafted, it is almost certain that it will give Beijing greater control over its special administrative region.

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Called the two-sessions, it is the most important political gathering for China officials each year. This year’s sessions prioritized recovery plans from the brunt of the economic impact of Covid-19. Beijing also sought the chance to pass a Hong Kong security bill bypassing Hong Kong’s legislation, in order to end the anti-government protests that have rocked the semi-autonomous city for months. 

 Economy  

China has abandoned the annual growth target for the first time as the world still grapples with the pandemic and a global economic fallout begins. The coronavirus lockdown has slashed China with a historic 6.8% GDP drop in the first quarter in 2020, marking the first contraction since 1992. 

 “The global epidemic situation and economic and trade situation are very uncertain, and China’s development is facing some unpredictable factors,” Chinese premier Li Keqiang said at the start of the NPC.

 As central banks in the US and Europe went all in with buying government debts and cutting interest rates to save the market, China did not follow. Yi Gang, China’s Central Bank (PBOC) governor has warned against excessive stimulus measures.

 “The normal monetary policy should be kept as long as possible,” he said. 

 Yet the PBOC has already eased its monetary stance, including injecting liquidity into the market through its daily reverse repo purchase program and cutting its benchmark lending rate. 

 By de-emphasizing the growth target, the premier prioritized more flexible measures on local level to spur up employment. Premier Li announced a target to create 9 million urban jobs in the coming year, down from last year’s target of 11 million. 

 Li Xunlei, the chief economist of Zhongtai Securities, estimated a 20.5% unemployment rate, much higher than the official data of 6% released by the National Bureau of Statistics in April. Li and his team said in a report that the large number of self-employers in China, especially in the service industry, were frontline victims of the pandemic lockdown. 

  China’s Economic Policies in Comparison

 The New Infrastructure 

In 2009, China announced a 4 trillion yuan ($586 billion) fiscal stimulus package, with the largest portion in infrastructure to lift its economy from the global financial crisis. Ten years after, facing another global recession, the central authorities saw the pandemic  as “great timing” to develop “the new infrastructure,” which encompasses 5G, ultra-high-voltage power facilities, inter-city transport, new energy vehicle charging stations, big data centers, artificial intelligence and industrial internet.

 The idea, first mentioned at a central economic conference in late 2018, gained more attention from both the public and the private sector amid the coronavirus lockdown. Beijing suggested that it would leverage the pandemic to catalyze the development of data infrastructure and upgrade industrial production.

 Li Zuojun, a senior official at the Development Research Center of the State Council told National Business Daily that traditional infrastructure investment sparked a short-term stimulus, but lacked long-term return on investment. China’s economy, bearing downturn pressure, needs a new engine and more effective stimulus measures.

 China’s leading tech firms have embraced Beijing’s calls for digital infrastructure. Li Yanhong, CEO of Baidu, the largest search engine in China, also a CPPCC member, proposed a plan about smart urban transportation with live big data during the two sessions. Tech giant, Tencent, pledged to invest 500 billion yuan ($69.9 billion) in areas from cloud computing to artificial intelligence. 

 Two days after the end of China’s two sessions and the reinforcement on the new infrastructure plan, President Trump issued an executive order suspending some Chinese graduate students’ entry into the country, especially ones working in the sciences. Although not directly tied to China’s ambitious 5G and AI plans, the ban cited the threats of illegal acquisition of intellectual property and potential national security posed by Chinese students. 

 Hong Kong 

The national parliament passed the highly controversial Hong Kong Security bill, a sweeping security legislation that broadens Beijing’s power over Hong Kong. The law prohibits any act of treason, secession, sedition, subversion, and foreign entities from conducting political activities. 

 The bill came after Hong Kongers’ months-long protests against a plan to allow extradition to mainland China. Beijing feared that the former British Colony, under the “one country, two systems,” had spoiled freedom and exposed itself and the central government to external forces. 

 Hong Kong, as an semi-autonomous region from China, is a commercial and trade hub in East Asia. Although the Hong Kong government spokesperson said “the vast majority of law-abiding Hong Kong residents, including overseas investors, have nothing to fear,” Hong Kong residents did not share the confidence. They rushed for the emigration gates and investing in overseas properties, soon after the controversial plan unveiled, South China Morning Post reported. 

 The anti-government protest roiled Hong Kong again after the security law was passed, despite the risk of the pandemic has not settled. Trump announced that Hong Kong would no longer receive its special status as it lost autonomy. Meanwhile, American officials are discussing ways to punish China for the drastic move. 

 Yet, the outbreak of George Floyd protests across the US handed Beijing a new weapon to compare the unrest in the US and Hong Kong’s pro-democracy demonstrations and accuse the US of hypocrisy. 

 Hua Chunying, China’s foreign ministry spokesperson, tweeted “I can’t breathe,” the last words of George Floyd, with a screenshot of a post of her American counterpart that called for the Communist Party’s accountability on Hong Kong, implying the US government’s double standards.

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As Hong Kong enters its 16th week of pro-democracy protests, international students in America are watching the escalating conflict between those who support China and those who support Hong Kong.

 Leah Chiu, who grew up in Hong Kong and recently moved to the US for university, is concerned about the growing tensions back at home. 

 “I personally do not condone the violence, but I support what they are fighting for,” she said. “Some of the behavior of the protestors are wrong, but police brutality is also wrong. Of course, people will have strong opinions on either side, but my personal opinion is that the violence is just wrong.”

The conflict initially ignited over Hong Kong due to the extradition bill. Locals were concerned that if the extradition bill was passed, political activists could be sent to mainland China for trial under the communist-controlled justice system.  Many young people began peacefully protesting on the streets. The peaceful protests did not last long, as police began to fire rubber bullets and tear gas at the protesters, which caused many injuries. In retaliation, a group of angry protestors stormed into parliament and vandalised the space. 

Although Hong Kong’s leader, Carrie Lam, has formally withdrawn the extradition bill three weeks ago, Hong Kong citizens do not plan to back down. 

“There are five demands, and they don’t plan to stop protesting until all five demands are fulfilled.” Chiu said.

Jackie Xing, a Chinese International Student from Beijing, thinks that the media is responsible for exacerbating the conflict. 

 “The way China and America uses the media to manipulate people is the same,” he said. “They use the same language to emotionally influence everybody. It’s just that in America, everybody supports Hong Kong.”

Jackie Xiang believes that the media is playing a role in exacerbating the conflict between China and Hong Kong. Photo by Bessie Liu

A few weeks ago, Chinese state media sent shockwaves across the international Chinese community through WeChat, China’s most popular multi-purpose social networking, messaging and banking application. A video of Hong Kong protesters beating up a Chinese man at the Hong Kong International airport was circulated. Many Chinese international students, angered by the video, began to verbally and physically attack Hong Kong students on their university campuses. 

 Xing was disappointed by the actions of the pro-China protesters.

 “I hate the pro-China Protests because they yell bad words in public,” Xing said. ”Maybe it’s because the Chinese don’t know how to protest, but they should know that their actions represent China and people will think that is how Chinese people are.”

Growing up, Joy Wu was taught that Hong Kong and Taiwan were both a part of China, she never questioned this until she moved to the US. Photo by Bessie Liu.

 Joy Wu, who recently moved to New York from Shanghai, was surprised that the pro-China supporters overseas did not properly inform themselves before joining the protests.

“I would have expected international students to have a more well-rounded perspective instead of blindly supporting the anti-Hong Kong protests,” Wu said.

Wu empathized with the opinions of her friends and relatives in China as she reflected on her own upbringing in China.

 “When I was in middle school, they instilled the idea that Hong Kong is a part of China, that Taiwan is a part of China,” she said. “They never taught us the complexities or talked about how people there actually felt, which is why it’s not surprising that many people living in China are so supportive of the government.”

 Observing carefully the conflict between China and Hong Kong, is Taiwan. Just like Hong Kong, Taiwan is not considered to be an independent sovereignty by mainland China. Many Taiwanese people are concerned that they will have a similar fate to that of Hong Kong’s.

Catherine Hsu is concerned about the future of Taiwan as she observes the escalating tensions between Hong Kong and China. Photo by Bessie Liu.

 For Catherine Hsu, who had recently come to the US from Taiwan, supporting the Hong Kong protests was extremely important.

 “In Taiwan, we are worried that if we do not support Hong Kong then the next one will be us,” she said. “My parents are telling me to stay in America and get a job here, so that when China comes, they can move here as well.”

Tsai Ing-wen, Taiwan’s current president, is gaining a lot of support from citizens for her strong stance against China. With the Taiwanese presidential elections just around the corner, Taiwanese citizens are looking for a leader who will not compromise their democracy.

“Our current president is very pro democracy and anti-China,’” Hsu said. She is likely to be elected for another term. She has been vocally supportive of Hong Kong in many of her speeches, saying democracy is not something you can step all over.” 

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