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Economy

Will Hong Kong Chief Attend APEC?

Sep 05, 2023
  • Li Huan

    Deputy Director at CICIR's Institute of Hong Kong and Macao Studies, and Distinguished Research Fellow, Xiamen University

The appearance — or absence — of Hong Kong Chief Executive John Lee Ka-chiu at an informal meeting of APEC leaders can be either technical or political. The United States is making it political.

The 2023 meeting of Asia-Pacific Economic Cooperation members will be held in San Francisco in November. According to a July 27 report in the Washington Post, the U.S. decided to bar the Hong Kong chief from attending on grounds that Lee has been sanctioned by the U.S. since 2020, when he was secretary for security in the special administrative region. It was reportedly the Biden administration’s decision. If true, the report indicates that the White House has decided to handle Lee’s participation politically rather than technically.

In 2020, the U.S. unilaterally imposed sanctions on Lee on the basis of Executive Order 13936, which was signed by Donald Trump. In addition to Lee, 10 other officials from Hong Kong and the Chinese mainland officials, including the chief executive at the time, were also sanctioned. President Joe Biden has extended the order three times, keeping the sanctions in force. Of course, the power to impose, waive or remove sanctions is in the hands of the White House.

Banning Lee on a political pretext will certainly aggravate tension between the Hong Kong government and the United States. In recent years, the world’s sole superpower has used China’s National Security Law regarding Hong Kong as an excuse to impose sanctions on SAR officials, canceled differential treatment for Hong Kong on grounds of falsely alleged loss of high autonomy and even targeted the Hong Kong Economic and Trade Office in the U.S. and the SAR’s separate memberships in multilateral institutions and organizations.

These maneuvers are sending unfriendly signals. As a matter of fact, the rights enjoyed by the people of Hong Kong under the Chinese Constitution and the Basic Law have not changed, and all SAR administrations attach great importance to relations with the United States. Hong Kong has always maintained close ties with America. In the economic and financial fields alone, U.S. last year was Hong Kong’s third-largest trading partner after the Chinese mainland and ASEAN, with a total trade volume of $64.1 billion (HK$502.1 billion). Hong Kong is the fifth-, seventh- and the 21st-largest export market for American wine, beef and agricultural products. As of the end of 2021, the market value of U.S. foreign direct investment positions in Hong Kong reached $45.6 billion. As an international financial center, Hong Kong also hosts many American-funded banking institutions and insurance companies.

The reportedly planned move by the U.S. will also further complicate its already difficult relations with China, which have gone through twists and turns in recent years despite an express Chinese desire to work with the U.S. to manage differences and avoid a strategic accidents.

However, domestic politics in the U.S. has driven its China policy increasingly in an ideological direction. Be it the three Cs formulation — competition, cooperation and confrontation — or the “invest, align and compete” framework, competition stands out prominently. Recently, Biden signed an executive order to block U.S. investments in China in the fields of semiconductors, microelectronics, quantum information technologies and artificial intelligence, building a so-called small yard with a high fence in high-tech. The executive order also treats Hong Kong and Macao the same as the Chinese mainland in a continuing attempt to gradually abolish the preferential treatment the SARs previously enjoyed.

The U.S. is sending a signal of disunity while the world economy is still in a critical post-pandemic recovery period. APEC is an important regional organization dedicated to economic cooperation and regional development. Hong Kong joined in the name of “Hong Kong, China” in 1991 and has sustained its membership under the Basic Law since reunification. Over the years, it has been actively involved in APEC activities, making a huge contribution and also benefiting a lot. The 21 member economies should use the upcoming meeting to demonstrate their commitment to jointly boost development of the world economy, especially in this region. The reported shunning of Lee and Russian President Vladimir Putin convey a strong confrontational message.

Neither an easing of China-U.S. tensions nor improving Hong Kong-U.S. relations can be achieved through unilateral efforts. They will have to involve a gradual, probably staggering, step-be-step process of engagement and exchanges, negotiation and compromises, gestures of goodwill and growth of trust. Whether China and the U.S. can use the APEC occasion to stabilize and grow their relationship, achieve a Xi-Biden meeting, or move further to implement the agreement between the two heads of state in Bali, will test their wisdom and sense of responsibility to their own people, to countries in the region and to world development.

John Lee Ka-chiu’s attendance at the APEC meeting should be addressed in a practical manner. Under the group’s rules, Lee, as the chief executive of the HKSAR, is invited by default. Of course, a formal invitation letter (usually sent by the host country at least eight weeks before the meeting, with a further circular explaining the agenda and other details about one month before the meeting) demonstrates courtesy and respect by the host country. Since the U.S. does not give Hong Kong visa-free treatment, Lee needs to obtain a visa to go there. But this cannot be approved because of the sanctions. The American government’s executive branch is fully capable to finding a proper solution to this.

Of course, instead of attending, Lee could send someone on his behalf who is not sanctioned by the U.S. This would involve some trade-offs for the SAR government.

Difficulties in China-U.S. relations should be addressed with reason. History has proved countless times that political manipulation does not solve political problems, but only complicates them and leads to more problems in the economic, diplomatic and military fields — or even to wars. As two responsible major countries in the world, China and the U.S. need a more rational and pragmatic attitude in addressing both specific bilateral issues and bigger topics of world development and the future of mankind. They also need to truly manage their differences, focus on cooperation and expand common understanding.

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