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Hong Kong’s long reign as the world’s freest economy is at risk because of China’s efforts to quell dissent, the Fraser Institute said, undermining the government’s arguments that the crackdown was improving the business climate.
The Vancouver-based research institution warned in its Economic Freedom of the World 2020 report that the comprehensive national security law enacted in June and other measures would damage Hong Kong’s number one ranking in future polls. The former British colony continued its 24-year run on top of the latest report, which was based on 2018 data, ahead of Singapore and New Zealand.
“Hong Kong’s rating in this report is not affected by the 2019 proposal to transfer certain legal cases to the mainland and the protest and sometimes the brutal crackdown that followed,” the right-wing think tank said. “However, it will be surprising if the apparent increase in insecurity of property rights and the weakening of the rule of law caused by Chinese government interventions in 2019 and 2020 do not result in lower scores.”
Hong Kong CEO Carrie Lam has cited the city’s continued high ranking in the Fraser report and similar polls to counter claims that efforts to suppress political unrest were jeopardizing its status as a global financial center. China’s imposed security law gave the government vast new authority to prosecute subversion, secession, terrorism and collusion with foreign powers, including the ability to transfer cases to mainland courts.
The government rejected the report’s claims, saying it remained determined and committed to upholding the rule of law. “We regret that the Fraser Institute appropriates lower future scores in this area with biased comments and unfair speculation based on unsubstantiated selective opinions,” the government said in a statement Friday.
The decision to enforce the security law without a public hearing or vote was possibly the most dramatic shock to Hong Kong’s political system since it returned to Chinese rule in 1997. The government has already used the law to ban protest slogans and arrest more than 20 activists, including media mogul Jimmy Lai.
The legislation has prompted the United States to reverse the special business privileges granted to Hong Kong, while tech companies have accelerated efforts to get sensitive data out of the city. On Thursday, Hong Kong police arrested 15 people on suspicion of manipulating the share price of Lai’s Next Digital Ltd. during a campaign to support the company after his arrest last month.
Hong Kong fell to second place on the Heritage Foundation’s 2020 Index of Economic Freedom, due to the political turmoil of the past year. The city also dropped seven spots to 80th in Reporters Without Borders’ latest World Press Freedom Index 2020. Bloomberg News
