Why so serious?
So, pro-establishment propaganda always like to dismiss HK as irrelevant and anything favouring the pro-democrats as nothing more than foreign interference.That CCP would rather flatten and let the city burn to a crisp than let HK have universal suffrage. Fine, then why is the CCP and the HK government so nervous about this HK bill in Congress? A violation of Chinese sovereignty? Well you can argue it is internal matters of the US to choose how it treats HK. The bill does not reject the fact that HK is part of China. It simply have a mechanism to decide whether HK warrants special treatment separate from that of China. Let's do a little analysis and dig down for the reasons:
Shanghai or Shenzhen replacing HK?
You see, people keep saying Shanghai or Shenzhen will replace HK. And yes, their economic development over the last 30 years is something to be recognized and even admire. Their transport and physical infrastructure have surpassed that of HK. They have newer and more impressive skyscrapers, urban parks, highways and malls than HK now. And Shenzhen epsecially in how it has focused on high technology development and and so on. But neither city will replace HK anytime soon, if ever. Why? 70% of foreign investment to and from mainland China goes through HK. That figure says it all.
An easily exchanged currency rather than the inconvertible yuan, free flowing rather than strict capital controls and the common law legal system in HK vs a rule of man system on the mainland are all something that cannot be easily changed. It is not simply the case that Beijing can declare a new global financial centre and it will become one. No, international business like multinational firms, creditors and other states will have to buy into that. And so far, none has shown any inclination to find an alternative Chinese city to HK (Singapore is more than 1,600 miles south of HK and an independent sovereign state who cares more about relations with Washington). So Beijing knows HK is their achille's heels.
Sanctions
So long story short, Beijing knows HK is still vital to their economy, whatever they say otherwise in their propaganda. There are two risk here. The bill will sanction HK and mainland officials personally, oh yes, this will scare them, no more trips to California. No more sending kids to schools in the US. No more investment in the US. That will definitely sting. The other sanction is even more risky for Beijing. Ever since the handover, Washington has one eye open and one eye shut on HK's role as a conduit for China to access high technology equipment, getting around sanctioned entities (i.e. North Korea, Iran firms). Now Washington is no longer prepared to take such a relaxed approach and will tighten oversight of mainland firms using HK as a transhipment point to evade US sanctions. This will sting Beijing even more.
Self-Inflicted own goal
This may not bode well for HK's long-term stability and development. The SAR government had said it wanted to focus the city on developing high technology, IT and AI, to wean itself off reliance on real-estate. Well all that, like it or not, depends on access to Western technology at this point. For all the bravado and chest pounding that Beijing does, it knows at the end of the day that it is nowhere near the point where it can replace Western know-how. But all those plans are on a slippery slope if US refuse access to those technologies. From the government's perspective, it was never wise to put HK in the centre of the rising US-China tension. The smart choice was to lay low, let them fight it out while preserving the city's advantages. But no, Lam refusing all arguments to the contrary, ram ahead with this extradition bill. And so, from Washington's view, if Lam is so insistent on screwing over her own city, why not let her? It is a self-inflicted own goal by Lam and her government.
What now?
So what now? What are the paths for HK economic development in light of this bill? You can tell me.