by Koo Lap

The latest edition of The Economist discussed the functions of central banks and pointed out that, their basic duties are price stabilizing, economy stimulating, exchange rates consolidating, and equality and environmental sustainability promoting. The effectiveness depends on credibility. “Credibility depends, however, on the perception that central banks can indeed act independently,” The Economist wrote. Eddie Yue, who has been the Chief Executive of the Hong Kong Monetary Authority (HKMA) for just over a year, has provided a negative example which makes us question, “can HKMA act independently?”

Yue boasted he has spoken at nearly 70 events after Beijing introducing the national security law and convinced 15,000 international finance professionals that the “Hong Kong judicial system and the common law-based legal system have not changed. The judicial independence will continue to be guaranteed.” Has Yue made the concern of the finance professionals all disappeared, or was he only jesting? So far, seven people died after being vaccinated with Sinovac, but Yue revealed to the reporter that he went with his brother-in-law to get vaccinated and is still in good health. He looked so pleased, like a true patriot.

The Court of Final Appeal (CFA) did not seem to share the confidence in the national security law as Yue. In the written judgment of Jimmy Lai’s bail application, the five judges said the national security law was directly imposed on Hong Kong by Beijing, so the CFA lacked jurisdiction. It is obvious judicial independence has not “continued to be guaranteed.” The judgment also pointed out, although Lai has not yet been convicted, “no bail shall be granted to a criminal suspect or defendant unless the judge has sufficient grounds for believing that the criminal suspect or defendant will not continue to commit acts endangering national security.” It has written off the common law’s “presumed innocent until proved guilty.” So Yue’s jest has cost his credibility. But it is more relevant to Hongkongers, or their purse for that matter, whether HKMA, which has the responsibility to maintain the linked exchange rate of the Hong Kong dollar, can act independently.

Guo Shuqing, Chairman of the China Banking and Insurance Regulatory Commission (CBIRC), has not left us much room for imagination regarding the HKMA. He bluntly pointed out, “...China’s banking and insurance system as a whole will never act in accordance with U.S. laws and regulations...Financial institutions in Hong Kong, including Chinese-funded institutions and foreign-funded institutions, will not implement the U.S. sanctions, which are totally non-binding.” The financial institutions have forced Carrie Lam to receive her salary to be paid in cash and Chris Tang to give up on his credit cards. But Chairman Guo has given his order to treat Hong Kong’s financial institutions the same way as those in the mainland. It seems hope is on the horizon for those senior officials sanctioned by the U.S.

The merging of Hong Kong and the mainland did not eliminate the worries of the international finance professionals on the national security law as Yue said. In addition, Hong Kong, which had been on top of the index of economic freedom for over a quarter of a century since the inception of the index, has been booted down to no. 107 because the Heritage Foundation has followed Chairman Guo’s instruction and listed Hong Kong as part of China. Paul Chan, claiming the act of Heritage Foundation has reflected its political bias, wrote to the Wall Street Journal to argue his case. He said that the strength of Hong Kong – its business, trade, and financial freedom, and healthy and stable public finance, has not changed, and therefore should not be off the list. But the Wall Street Journal retorted that HSBC, Jardine, and Taikoo have all followed the mainland’s institutions and voiced their support of the national security law; Cathay Pacific reviews Facebook posts made by its staff. It is impossible to fake economic freedom simply by Chan’s spin.

Yue and Chan, two of the highest rank officials in the financial sectors, are not the only person who has lost all credibility. The lacking of approval from WHO has not stopped Hong Kong’s Expert Committee, consisting of 12 members, from recommending Sinovac to the Hong Kong people. They said it is better to vaccinate than not. But all the medical experts and professors, including the committee members, have all abandoned Sinovac and chosen to be vaccinated with BioNTech instead. The experts have received western medical training that boosted “evidence-based medicine.” Despite people who got vaccinated with Sinovac are dying one after another, the experts concluded their death has nothing to do with the vaccination, even before receiving the autopsy result. What they said and did has caused suspicion that perhaps these experts only recommend Sinovac out of political correctness, just like Yue and Chan.

From financial technocrats to medical experts, their credibility has all disappeared into thin air. The cause: politics takes top priority. It is just the beginning, as Beijing ordered only patriots can govern Hong Kong. People said that love is blind, which means facts would be disregarded. That is why Yue and Chan could not admit the national security law has destroyed the judicial and financial system, and experts could not question the effectiveness of the China-made vaccines. When everyone’s love for the country is so blind that they ignore the facts and reality, they have thrown away their credibility. Hong Kong will not be free and open again, never mind having a diverse and prosperous development. Zhu Rongji’s words are spot-on: Hong Kong is to be ruined by patriots.

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