© Bloomberg. Residential and commercial buildings are seen from Victoria Peak in Hong Kong, China on Monday September 11, 2017. Hong Kong shares fluctuated on September 12 as automakers extended their gains thanks to China’s plan to phase out fossil fuel vehicles, while banks and property companies weighed on the benchmark. Photographer: Billy H.C. Kwok / Bloomberg
(Bloomberg) – Hong Kong’s long reign as the world‘s freest economy is at risk due to China’s efforts to quell dissent, the Fraser Institute said, contradicting government arguments that the crackdown improved the business climate.
The Vancouver-based research institution warned in its World Economic Freedom 2020 report that the sweeping national security law enacted in June and other measures would hurt Hong Kong’s top spot in future investigations. The former British colony continued its 24-year run to the top of the latest report, based on data from 2018, ahead of Singapore and New Zealand.
“Hong Kong’s rating in this report is unaffected by the 2019 proposal to transfer some legal affairs to the mainland and the protest and sometimes brutal crackdown that followed,” the right-wing think tank said. “However, it will be surprising that the apparent increase in property rights insecurity and weakening of the rule of law caused by Chinese government interventions in 2019 and 2020 do not translate into lower scores. “
Hong Kong chief executive Carrie Lam cited the city’s consistently high ranking in the Fraser report and similar surveys to counter claims that efforts to suppress political unrest were undermining its status as a global financial center. China’s imposed security law has given the government new authority to prosecute subversion, secession, terrorism, and collusion with foreign powers, including the ability to refer cases to mainland courts.
The government rejected the report’s claims, saying it remained committed and determined to uphold the rule of law. “It is with regret that the Fraser Institute warns of future lower scores in this area with biased comments and unfair speculation based on unfounded selective opinions,” the government said in a statement Friday.
The decision to impose the security law without a public hearing or vote was arguably the most dramatic shock to Hong Kong’s political system since its return to power in China in 1997. The government has already used the law to ban protest slogans and arrest over 20. activists, including media mogul Jimmy Lai.
The legislation prompted the United States to revoke special business privileges granted to Hong Kong, as tech companies ramped up efforts to move sensitive data out of the city. Hong Kong police arrested 15 people on Thursday on suspicion of manipulating the share price of Lai’s Next Digital Ltd. during a campaign to support society after his arrest last month.
Hong Kong has slipped to second place in the Heritage Foundation’s 2020 Economic Freedom Index, due to political unrest last year. The city also fell seven places to 80th place in Reporters Without Borders’ latest Global Press Freedom Index 2020.
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