DAVOS (Switzerland) • Chinese President Xi Jinping offered personal assurances that he would not use the protests in Hong Kong as an excuse to increase Beijing's control over the city, Chief Executive Carrie Lam said, as she used a World Economic Forum visit to try and reassure global investors.
Speaking to Bloomberg Television in Davos, Switzerland, on Tuesday, Mrs Lam pushed back against protesters who say China is tightening its grip on Hong Kong, and maintained that the Asian financial centre remains stable despite more than seven months of violent protests.
"There is no truth in the allegation that the central government is tightening the grip on Hong Kong," Mrs Lam said in the interview. "The central government has, time and again, made it very clear that they want Hong Kong to succeed under 'one country, two systems' and a high degree of autonomy."
"It was made very clear to me by President Xi Jinping on the three occasions that I met him" in recent months, she added.
Mrs Lam arrived in Davos after a fresh bout of protest violence in downtown Hong Kong, with four police officers injured in clashes with demonstrators on Sunday following an otherwise peaceful rally. More than seven months of pro-democracy protests have battered the former British colony's economy, undermined its reputation for political stability and increased geopolitical tensions between the United States and China.
China has governed Hong Kong since 1997 under a "one country, two systems" framework that preserves its freedom of expression, independent courts and capitalist financial system.
The city's pro-democracy opposition has accused Beijing of eroding that autonomy and stonewalling calls for meaningful direct elections of the chief executive, who is currently selected by a 1,200-member committee.
In the interview, Mrs Lam pushed back against the idea that Beijing was calling the shots in Hong Kong, maintaining that the city has a significant degree of autonomy.
She said she almost immediately suspended legislation allowing extraditions to China that initially prompted the unrest, and that "one has to wonder what are the underlying factors that have caused this sustained social unrest".
Referring to China's directives, she said: "They have not given any explicit directive on how to handle it, except that they have made it clear that the solution also has to abide by 'one country, two systems'.
"You can't go beyond the constitutional requirement to solve this issue. Similarly, domestically, I couldn't go beyond the rule of law to solve this political crisis."
The protests have had a profound impact on the city's retail-and tourism-dependent economy, with rallies deterring visitors from China and elsewhere, and leading companies to cancel many local events. The government has estimated that the economy contracted 1.3 per cent last year, and economists forecast stagnation this year.
Mrs Lam's administration has so far proposed additional spending of about HK$25 billion (S$4.34 billion) - or less than 1 per cent of the city's gross domestic product - despite holding fiscal reserves in excess of around HK$1 trillion.
"Those four rounds of measures introduced and announced by the financial secretary are really relief measures," Mrs Lam said. "They are there to support the companies, especially the small and medium-sized enterprises, so that we can preserve as many jobs as possible.
"Ultimately, to take Hong Kong out of the economic difficulties requires first of all, stability. Second, it is an early restoration of law and order, and third, it is continued government investment in important sectors - for example, innovation and technology."
Mrs Lam and "Team HK", including the city's trade secretary, top officials from the stock exchange, the airport authority, MTR Corp and the head of Swire Group, are in Davos to convince global business and political leaders that the Asian financial hub is open for business.
Rating agency Moody's had this week downgraded Hong Kong, a decision Mrs Lam said she was very disappointed by.
Ms Laura Cha, chairman of bourse operator Hong Kong Exchanges and Clearing, told Reuters on Tuesday that the city had held up remarkably well despite the protests. "We are resilient. We are stable and investors still have confidence in us," Ms Cha said. "The rule of law is sound in Hong Kong."
BLOOMBERG, REUTERS
