HONG KONG (Reuters Breakingviews) - Talk about an impossible job. Hong Kong needs a competent, charismatic leader to reassure a rattled finance industry, tame crazed property prices and make peace with a protest movement. The ideal candidate won’t look like Beijing’s pawn, while being precisely that. Nor can the candidate be a tool of the tycoons, although without their support election is impossible.
Unpopular Chief Executive Leung Chun-ying said he won’t seek reelection in a surprise announcement on Friday. Neither the Chinese leadership nor Hong Kong will miss the island’s least popular executive since it returned to Chinese control in 1997.
Graphic: Chief Executive Leung Chun-ying's popularity ratings - HKU survey: bit.ly/2gqCSqL
As far as Beijing was concerned, Leung was supposed to quietly solidify mainland control while maintaining economic and political stability. What Beijing got was massive, embarrassing protests, anxious foreign investors and increasing economic vulnerability. Property prices, blamed for increasing social inequality to the benefit of tycoons, continued to rise. Just 20 years after reunification, Hong Kong already has a nascent independence movement.
Graphic: Hong Kong housing prices keep rising despite cooling measures: reut.rs/2hejpOb
Some hope a less ham-fisted executive might undo some of the damage Leung did with his mouth. “Democracy would see poorer people dominate Hong Kong vote,” he famously said in an interview. But that statement, however clumsy, reflects the Chinese Communist Party’s approach to governing Hong Kong through a leader chosen by a cosy 1,200-person committee dominated by the business elite. Leung may have been a lightning rod, but his replacement will draw the same fire.
The economy will be similarly difficult to manage. The tightening of China’s capital account has depressed activity in the “dim sum” offshore yuan market; flows through pilot programmes linking Hong Kong and mainland stock exchanges have been similarly tepid. If a Donald Trump presidency sees global capital flows and trade decline, the island will get walloped from the other direction.
All this cries out for a reformer who can restore Hong Kong’s confidence in its political and economic future, drive compromises in Beijing that will placate democracy activists at home, and defend the rule of law so the critical foreign financial sector stays put. But the current set-up means there’s little likelihood of such a person winning office, barring renewed appetite for reform in Beijing.
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