Hong Kong protests and China’s economic policy

CHINA ADVISORY - Report 02 Aug 2019 by Andrew Collier

The continuing protests in Hong Kong have put Beijing in an awkward position. Xi Jinping does not wish to appear weak by losing control of Hong Kong. Nor does he want to intervene directly and make the situation more volatile. Xi is refraining from intervening in order to avoid:

Solidifying opposition in Taiwan to the PRC by direct intervention in Hong Kong.
Further inflaming the Trump Administration against China.
Hurting Hong Kong’s role as a middleman in capital flows between China and the world.

An additional issue, and one much harder to analyze, is the impact of the rising discontent in Hong Kong on policy making ‒​ particularly economic policy making ‒​ in the PRC. In this report, we make some hypotheses.

Now read on...

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