Asia’s World City
It has been almost two years since the emergence of COVID-19, and for some countries, it seems like the end is in sight. While it may still take half a year before the world reaches herd immunity via vaccinations, which is commonly accepted to be 75% of the population, the majority of the “developed” world has slowly seen a relative return to normalcy. Despite the emergence of the Omicron Variant and the reintroduction of travel restrictions, international travel has been slowly re-emerging between countries with high vaccination rates. The United States reopened its borders to fully vaccinated travelers earlier this month after maintaining travel restrictions for over 20 months, while Canada opened its borders to fully vaccinated travelers in early September.
However, Hong Kong is a notable outlier in this trend. The city, along with many of its East Asian neighbours, has dealt with the pandemic admirably. By February of 2021, the city had largely returned to pre-pandemic life while cities around the world were still reeling from large numbers of infections. As of November 25th, there have only been about 12,400 confirmed cases of COVID-19 within Hong Kong during the entire pandemic, which is significantly lower on a per capita basis than any European or North American city of comparable size. The city has achieved this by using a combination of lockdowns, strict travel restrictions, efficient contact tracing, proactive policymaking, and widespread public cooperation with these measures. However, as the pandemic winds down, the city’s government has unexpectedly found itself in a tough spot with no easy way forward.
For a highly globalized city, Hong Kong thrives on international economic activity, particularly in the financial sector. In addition, it also has one of the largest expat populations in the world, and the world’s 8th busiest airport. It is no surprise that the pandemic has been particularly tough on Hong Kong. Its economy shrank by over 9% in the first 6 months of 2020, only rebounding slightly once domestic restrictions were lifted. Combined with the political unrest that began in 2019, the city has struggled economically to regain its footing as the financial capital of Asia.
Pleasing the Dragon?
Despite its status as a global city, Hong Kong is highly economically reliant on Mainland China. Over half of its trade is conducted with the Mainland, and over 77% of tourists to Hong Kong come from Mainland China. This presents a problem for the city’s policymakers during a pandemic. Travel between the Mainland and Hong Kong is currently restricted, with travelers still being required to undergo 1-2 weeks of hotel quarantine when traveling from the Mainland to Hong Kong and 3 weeks from Hong Kong to the Mainland. Due to China’s strict COVID-19 travel restrictions, Hong Kong would have to coordinate its policies with China in order to relax travel restrictions with the Mainland. Should Hong Kong choose to relax its borders to international travel, it would have to forgo opening up to China, as the Chinese government does not allow a port of entry with entry requirements out of step with its own. As a result, the city has to choose between two options: open up to China and maintain its current zero-COVID approach – which is effective at stamping out any outbreaks but economically restrictive – or open up to the rest of the world and learn to function with the virus.
Although there has been no official statement from the Hong Kong government, it appears to be prioritizing the normalization of travel with China instead of the rest of the world. This is the financially logical option, as it will allow the city to recoup some of its lost economic activity, particularly in the tourism sector. Furthermore, as of November 25th, China has fully vaccinated almost 77% of its population, while it is unclear when the rest of the world will reach a similar degree of vaccination coverage. Thus, by prioritizing China, the city can also minimize the risk of importing more COVID-19 cases.
However, doing so will also hurt sectors that rely on international economic activity, such as the financial, aviation, and hospitality industries. Additionally, the city risks being further tethered to Beijing at a time when the political situation remains volatile following the 2019 protests, where widespread pro-democracy demonstrations raged for over half a year in response to Hong Kong’s Extradition Bill, which allows China to arrest political dissenters in Hong Kong.
All of this is further complicated by Hong Kong’s slower vaccine uptake. As of November 25, 67% of the population had received two doses, despite the implementation of the vaccination program in February of this year. This figure is lower than that of Mainland China and many other developed countries. Ironically, it may have been Hong Kong’s effectiveness at containing COVID-19 that has led to instances of vaccine hesitancy, since some do not see the need to get a shot when community transmission is negligible.
With vaccine uptake having stalled at only about 20,000 vaccinations per day, the city must find a way to increase administered doses to reach herd immunity, or a new major outbreak among the unvaccinated could plunge the city back into a lockdown. Without greater vaccination coverage, re-opening the city will be a risk and one that the Hong Kong government is not fully willing to accept. While the government has attempted to increase vaccine uptake by offering cash prizes and lotteries, there is still a long way to go.
An Uncertain Future for Hong Kong
The past few years have not been kind to Hong Kong, with both the Global Cities Index and the Global Power City Index demoting the city since 2019. With a stagnant economy that is failing to bounce back due to ongoing international restrictions, the government has resorted to handing out $5000 HKD spending vouchers to boost consumer spending. Although pandemic woes are not unique to Hong Kong, uncertainty surrounding the wider political and economic prospects of the city poses a greater challenge. With the government’s apparent push to normalize relations with China, some citizens may breathe a sigh of relief at the prospect of Chinese tourists and businesses flocking to the city once again. For others, the seemingly never-ending zero-COVID approach, closer alignment with China, and the 2020 security law will likely add to the quiet sense of unease.