Before 1997, Hong Kong was a British protectorate, on the border of Communist China.  In 1899, Britain was granted a 99-year lease on the colony, and it became a thriving financial center, among other things.  The population density of Hong Kong is remarkable, with numerous high-rise apartment buildings, and nearly 6700 people per square kilometer!  Thousands of multi-national corporations had headquarters and field offices in Hong Kong, from where they had access to all of Asia.  The British Rule of Law held sway in Hong Kong, and residents could move about freely, transact business, go on tours all over the world, and go back and forth to Communist China to see relatives and do business.  In the Heritage Foundation’s Economic Freedom Index, Hong Kong topped the list.  The US was farther down, at 20!

That has all changed now.  In 2006, the British handed Hong Kong back to the Communist Chinese, and that was the beginning of decline.  The handover document referred to a 50-year period of autonomy, called “One Country, Two Systems”, but those in the know were afraid that the Communists would take complete control long before 50 years had passed.  Their fears have been justified.  The past two years have been extremely difficult for Hong Kong, with the Communists taking more and more control of the thriving city.  In an article in the Wall Street Journal, Edwin Feulner, former head of the Heritage Foundation, describes it this way:

Indeed, the loss of political freedom and autonomy suffered by Hong Kong over the past two years has made that city almost indistinguishable in many respects from other major Chinese commercial centers like Shanghai and Beijing….

In truth, however, China’s assimilation of Hong Kong started long before the handover of formal control from London to Beijing.  Hong Kong’s value was always as a blend of East and West, and its ties to the mainland and to the United Kingdom were equally important to its prosperity.  Now, however, its ties to Beijing are increasingly forged in steel, and its ties to London–especially to traditions of English common law, freedom of speech, and democracy–have weakened significantly.

A year ago, Communist China passed a new National Security Law for Hong Kong, and it was the equivalent of the Iron Curtain.  Hong Kongers no longer have a representative legislature, free speech and assembly are curtailed, its autonomy is reduced, and demonstrations and protests are no longer allowed.  Once the law was passed, many of the Hong Kong democracy activists were arrested and jailed, charged with new crimes of sedition and causing disorder.  Every day now, there is a new story of young people being detained on collusion with foreign powers charges.  Here are some of the features of the new Law, courtesy of the B.B.C:

• Crimes of secession, subversion, terrorism and collusion with foreign forces are punishable by a maximum sentence of life in prison
• Damaging public transport facilities can be considered terrorism
• Those found guilty will not be allowed to stand for public office
• Companies can be fined if convicted under the law
• Beijing will establish a new security office in Hong Kong, with its own law enforcement personnel – neither of which would come under the local authority’s jurisdiction
• This office can send some cases to be tried in mainland China – but Beijing has said it will only have that power over a “tiny number” of cases
• In addition, Hong Kong will have to establish its own national security commission to enforce the laws, with a Beijing-appointed adviser
• Hong Kong’s chief executive will have the power to appoint judges to hear national security cases, raising fears about judicial autonomy
• Importantly, Beijing will have power over how the law should be interpreted, not any Hong Kong judicial or policy body. If the law conflicts with any Hong Kong law, the Beijing law takes priority
• Some trials will be heard behind closed doors.
• People suspected of breaking the law can be wire-tapped and put under surveillance
• Management of foreign non-governmental organisations and news agencies will be strengthened
• The law will also apply to non-permanent residents and people “from outside [Hong Kong]… who are not permanent residents of Hong Kong“.

Now, even foreign citizens who live and work in Hong Kong (like the many employees of international banks and others), are subject to this draconian law. All foreigners need to watch their backs every day, so they do not attract the attention of the Communist government. Americans have already been detained and released, indicating that all non-Chinese residents are at risk. Communist China has kicked out members of the foreign press already, and more may follow if the report the truth of what has been taking place. There have been many articles recently, describing companies that are leaving Hong Kong.

Hong Kong grills finance executives on their reason for leaving. From the Financial Times.

Will companies flee Hong Kong?  From MarketWatch.

Global firms consider moving treasury operations out of Hong Kong.  From Reuters.

Businesses may consider moving from Hong Kong to Singapore.  From CNBC.

At this juncture, I would like to promote The Epoch Times, and excellent publication run by a fabulous group of reporters, many who are from Hong Kong.  They write extremely well about what is going on with Communist China, and with Hong Kong.  I urge my readers and followers to hop on over to their Web Site, and register to receive their newsletters, and support them by becoming a paid subscriber.  I am, and I have not been disappointed.  They have been de-monitized by YouTube, and are being censored by others in Big Tech.  They definitely deserve your support!  (if you decide to join, please let me know)  Just today, there is an excellent video story regarding Hong Kong, and Communist China generally, which everyone should see.

Epoch Times Story on Hong Kong, March 5, 2021.

I worry for the formerly-free people of Hong Kong, who are about to become just so many more Communist Chinese slaves.  I worry for the many foreign companies with a presence in Hong Kong.  How many of them will be able to get out before Beijing forbids them to leave?  When will Beijing start forbidding them to leave?  I hope it’s not too soon, because if foreigners are trapped essentially inside Communist China, their lives and their companies’s lives, are in grave danger.  Since so much of the economy of the entire world depends on international finance, how much damage can the Communist Chinese do by taking over Hong Kong?  And will the free countries of the world notice, or care?  Or will they object to Communist China’s depredations, and offer their help?  What do you think?

Updates Added July 20, 2021:

In the past few weeks, there have been many stories about what Communist China is doing in, and to, Hong Kong.  This past Saturday, the Wall Street Journal did a big story entitled: U.S. Warns of Rising Perils For Businesses in Hong Kong.  The story is behind a paywall, so I will summarize and quote from the story.  The Biden administration is warning US businesses in Hong Kong of the threats to their survival there, with the Communist Chinese getting tougher on foreign businesses, “tightening their grip on the city”.  Here is an important quote:

In an advisory issued Friday, the Biden administration cautions businesses and individuals working for them that they are subject to a restrictive national-security law that Beijing imposed on Hong Kong a year ago.  The advisory cites the risks of electronic surveillance without warrants and of being compelled to surrender corporate and customer data to the government.  

“This new legal landscape…could adversely affect businesses and individuals operating in Hong Kong.”, said the advisory, jointly issued by the Treasury, State, Commerce and Homeland Security departments”.  “As a result of these changes, they should be aware of potential repetitional, regulatory, financial, and, in certain instances, legal risks associated with their Hong Kong operations.”

The article notes that the security law gives wide latitude to the government to sanction individuals and businesses, and arrest workers or executives.  Of course, the Communist government portrays US fears as “totally ridiculous”; fortunately most American business people abroad know exactly how the Communists operate, and ignore that kind of propaganda.  Here’s another quote:

American businesses, especially financial firms, are among the biggest investors in Hong Kong.  Dozens of international companies have moved their regional headquarters or offices from the city since 2019, according to government data, and a survey by the  American Chamber of Commerce in Hong Kong released in May found that 42% of the 325 respondents said they were considering or planning to leave the city.

So, it looks like the situation in Hong Kong is heating up, and all kinds of foreign businesses are evaluating their security situation.  I’m pretty sure that everyone is well aware of what the Communists can and will do with their ubiquitous security apparatus, and are taking that into account.  I wonder, with the Communist Chinese kill the golden goose of foreign business and financial activity?  Maybe they will just squeeze very hard instead of shooting them out of the sky.  In any event, life has been getting harder, and shows no signs of improving any time soon.