The Taiwan Banker

On December 10, the Hong Kong District Council election (equivalent to local elections in Taiwan) reached the lowest turnout in history, falling from 71% last time to 28%. In fact, the voting rate for the Hong Kong Legislative Council dropped from 58% two years ago to 30%. This time, national security organs participated in the “rectified” election process, causing many Hong Kongers to give up on expressing their political opinions, even on local affairs. This low turnout indicates that most voters believe that voting is meaningless. The Hong Kong Special Administrative Region (SAR), which is under the governance of mainland China, has recently taken on a completely different look. On the economic front, the Hong Kong stock market been on the decline ever since the beginning of 2018, and has even been surpassed by the Taiwanese stock market. This is not only regarded as a symbol of the decline of the capital market, but has also caused international observers to question whether Hong Kong’s original financial and economic advantages have been lost following the implementation of the National Security Law. Attention has been focused on the maintenance of Hong Kong’s spirit of rule of law – especially on whether the judicial system is still independent enough to operate without administrative interference. However, the Basic Law defines a “high degree of autonomy” as separation of powers, executive leadership, judicial independence, and responsibility of the chief executive to the central government on behalf of the SAR. Therefore, local administration of Hong Kong people is only autonomous within the framework decided by Beijing. In other words, the central government holds ultimate decision rights and the basis of all power in Hong Kong. Only it can determine the interpretation of power. This has also triggered deeper economic concerns: can Hong Kong’s property rights still be fully protected under this system? Property rights are the most important foundation for Hong Kong as a world-leading free port and financial center. After all, the sanctity of private property is stated in the constitutions of most democracies and Western countries, and is upheld accordingly. In contrast, although Article 13 of the Constitution of the People’s Republic of China also stipulates that citizens’ legal private property rights are inviolable, Article 6 states more clearly, “The foundation of the socialist economic system of the People’s Republic of China is socialist public ownership of the means of production, that is, ownership by the whole people and collective ownership by the working people.” In other words, regardless of whether the Constitution is implemented, in terms of basic thinking, protection of property rights is predicated on whether the property is considered legal. Moreover, the factories, raw materials, or online e-commerce data required for production are owned by the whole people and workers collectively, rather than being owned exclusively by private enterprises or investors. This thinking is in obvious conflict with many elements of Hong Kong’s earlier role as a free port and an international financial center. Hong Kong’s increasingly precarious rights system will be a major concern for its subsequent growth. As Lin Chia-lung, Secretary-General to President of Taiwan, said in a recent speech: “Sovereignty under a democratic government is complete property rights, and also the basis of human rights.” In Taiwan, it is the sovereignty of the Republic of China that the people have continued to uphold, consistent with the process of democratization, which backs the stability of the new Taiwan dollar, real estate titles, and corporate equity, etc., without being affected by other countries’ legal regimes. Unfortunately, due to shortcomings in sovereignty and human rights, the economic accomplishments of China’s Reform and Opening achieved over more than 40 years, as well as Hong Kong’s proud assets, have been greatly affected. At the end of the year, as we take stock of our efforts over the past year, we should also cherish Taiwan’s democracy, not only as the source of our value, but also an indispensable cornerstone for sustained economic growth.