Hong Kong Letter: Harsh jail sentences may harm financial centre and trading hub reputation

Imprisoning of 45 former politicians and activists convicted under Beijing’s National Security Law could trigger the imposition of US visa restrictions on multiple Hong Kong officials

People wait to enter the West Kowloon Court ahead of a sentencing hearing for 45 pro-democracy activists in Hong Kong. Hong Kong’s special status could create a boom for its shipping and logistics industries next year if Donald Trump imposes a 60 per cent tariff on Chinese imports. Photograph: Lam Yik/Bloomberg
People wait to enter the West Kowloon Court ahead of a sentencing hearing for 45 pro-democracy activists in Hong Kong. Hong Kong’s special status could create a boom for its shipping and logistics industries next year if Donald Trump imposes a 60 per cent tariff on Chinese imports. Photograph: Lam Yik/Bloomberg

An unusually late tropical cyclone that skirted Hong Kong at the beginning of this week left the city battered by torrential rain for a number of days. Hundreds of people endured the downpour for hours on Tuesday morning to queue outside West Kowloon Magistrates Court, some of them camping out overnight to secure a spot at the front.

They came for the sentencing of 45 former politicians and activists convicted under the National Security Law (NSL) imposed by Beijing four years ago. Few of those who made it inside the building found seats in the courtroom, leaving most of them watching proceedings on video screens in overflow rooms.

The hearing lasted only a few minutes, with the presiding judge saying he was not going to read out the full sentencing statement, which ran to more than 80 pages. So he simply listed the sentences given to each defendant, identifying each of them by a number rather than by name.

Each received a long jail term with former law professor Benny Tai given the harshest sentence of 10 years in prison for devising a plan to hold primaries ahead of legislative elections. The aim was to maximise pro-democracy candidates’ chances of winning a majority so they could block legislation unless the executive agreed to their demands.

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In many jurisdictions this is normal politics but for the three-judge panel that heard the case, it was tantamount to an attempt to overthrow the government. The mother of Hendrick Lui, who was sentenced to four years and three months, was bundled into a police van outside the court after she held up a sign that read: “Righteous people will live, villains must die”.

Many of the same people who came on Tuesday queued outside the same courthouse on Wednesday morning when former media owner Jimmy Lai took the stand in his national security trial. They were joined inside the courtroom by representatives from a number of diplomatic missions in the city, including Ireland’s.

Lai is the most high-profile figure to face charges under the national security law and his cause has been championed by senior American politicians including Donald Trump. Keir Starmer raised the case this week when he met Xi Jinping on the sidelines of the G20 summit in Rio de Jainero.

But the harsh sentences handed down on Tuesday could have more serious, immediate consequences for Hong Kong and its reputation as a financial centre and trading hub. Within hours, US state department spokesman Matthew Miller said Washington would take action in response to the jailings.

“The 45 defendants sentenced today were aggressively prosecuted, and many now face life-altering imprisonment simply for their peaceful participation in political activities which are protected under the Basic Law of Hong Kong,” he said.

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“In response, the department of state is taking steps to impose new visa restrictions on multiple Hong Kong officials responsible for implementation of the NSL.”

Trump’s administration sanctioned 11 senior Hong Kong officials in 2020, banning them from owning property or other assets in the US and making it a criminal offence for anyone in the US to have any financial transactions with them. The city’s former chief executive Carrie Lam said she could not access banking services and had to keep piles of cash at home because of the sanctions.

More dangerous for Hong Kong are the questions the suppression of political dissent and the implementation of the NSL raises about the city’s autonomy. Although Hong Kong has been part of the People’s Republic of China since the handover from Britain in 1997, it has its own currency, central bank, passport and judicial system.

Crucially, it has its own representation in bodies such as the World Trade Organisation (WTO) and is fully integrated into the international financial system. This year, Hong Kong moved ahead of Singapore to return to its position as the number three financial centre in the world after New York and London.

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Hong Kong’s special status could create a boom for its shipping and logistics industries next year if Trump imposes a 60 per cent tariff on Chinese imports. The expectation locally is that the tariffs will not apply to Hong Kong so more Chinese goods are likely to be shipped through the city’s port to avoid them.

All of these advantages depend on the rest of the world agreeing that Hong Kong remains sufficiently autonomous from China with an adequately independent judiciary to justify them. In September, the US House of Representatives passed a Bill calling for a review of Hong Kong’s economic and trade offices in Washington, New York and San Francisco.

If the Bill is approved by the Senate, a review will determine if the offices should be stripped of their diplomatic privileges because they do not operate with a “high degree of autonomy”. The risk for Hong Kong is that more news from its courts like this week’s will call that autonomy ever further into question.