Wall Street accused of whitewashing China crackdown in Hong Kong |  Business and Economy News

Wall Street accused of whitewashing China crackdown in Hong Kong | Business and Economy News

Kuala Lumpur, Malaysia – Hong Kong’s government invited Wall Street’s biggest names to a summit to show the financial hub is open for business after nearly three years of isolation due to pandemic curbs.

Instead, top bank executives’ attendance at the gathering has become a lightning rod for criticism of China’s human rights record as participants face pressure to speak out about Hong Kong’s disappearing freedoms or stay home.

Hong Kong democracy activists and US legislators charge that authorities are using the Global Financial Leaders’ Investment Summit to whitewash a brutal political crackdown that has transformed the once-freewheeling territory beyond recognition.

About 200 financial leaders representing top financial institutions, including Goldman Sachs, Morgan Stanley, JPMorgan Chase, UBS and BlackRock, are expected to attend the summit, which takes place November 1-3.

During the event, bankers will share a stage with Hong Kong Chief Executive John Lee, who is among a number of Hong Kong officials under United States government sanctions over their role in the crackdown.

Hong Kong Chief Executive John Lee is under US sanctions over his role in the political crackdown on dissent in the Chinese territory [File: Tyrone Siu/Reuters]

On Friday, US legislators Jeff Merkley and Jim McGovern, both Democrats, warned that bankers risked being “complicit” in the crackdown in the former British colony, which was promised rights and freedoms that do not exist in mainland China as a condition of its return to Chinese sovereignty in 1997.

Since Beijing’s introduction of a sweeping national security law in response to violent anti-government protests in 2019, authorities have practically eliminated all political opposition, muzzled civil society and shuttered independent media.

More than 210 people, including legislators, journalists and union leaders, have been arrested under the law and a colonial-era anti-sedition statute, mostly for crimes related to speech. More than 10,000 people have also been arrested over their involvement in the 2019 protests for crimes ranging from rioting to unlawful assembly.

“These bankers couldn’t even open a checking account for Hong Kong Chief Executive John Lee — who has been blacklisted by the US and is prohibited from traveling to America,” Mark Clifford, a former newspaper editor in Hong Kong who now leads the Committee for Freedom in Hong Kong Foundation (CFHK), told Al Jazeera.

“International financial centers depend on freedom — free flow of information and rule of law,” Clifford added. “Hong Kong has neither anymore. It doesn’t deserve to be taken seriously by the international financial community.”

Hong Kong’s government has rejected criticisms of its human rights record and the summit, with No 2 official Eric Chan on Saturday accusing Western governments of trying to “suppress” the nominally autonomous territory and China.

In a statement to Al Jazeera, the Hong Kong Monetary Authority, the summit’s organiser, said: “We look forward to the thought-provoking, constructive discussions at the upcoming summit about how the financial sector can manage a complex set of risks and challenges and harness the power of finance to contribute to the well-being of the global community.”

JPMorgan Chase, UBS, Man Group and Brookfield declined to comment. Goldman Sachs, Morgan Stanley, BlackRock, HSBC and Standard Chartered, among other participants, did not respond to requests for comment.

Goldman Sachs chief executive David Solomon.
Goldman Sachs CEO David Solomon is among the top bankers attending the Global Financial Leaders’ Investment Summit in Hong Kong [File: Jason Lee/Reuters]

The controversy surrounding the Hong Kong summit highlights the awkward position facing corporations that seek to cash in on China’s growing economic opportunities while simultaneously taking vocal stances on social justice issues and human rights.

The dispute has also underscored how big business has often been more reluctant to shun China, the world’s second-biggest economy, than smaller economies accused of trampling over human rights, such as Russia, North Korea and Myanmar.

Despite ignoring calls to skip the Hong Kong summit, JPMorgan Chase and Goldman Sachs were among the long list of major companies to exit Russia over its invasion of Ukraine.

Other global brands that have shunned Russia, such as Nike and Volkswagen, have resisted calls to cease operations in China’s Xinjiang region, where ethnic minority Uighurs have faced mass internment and surveillance.

The corporate world’s desire to stay engaged with China is not surprising as businesses are “rational and often opportunistic actors,” said Surya Deva, an expert in business and human rights at Macquarie Law School in Sydney, Australia.

“They will be participating in the Hong Kong summit because they see more benefits than risks in doing business in Hong Kong and China,” Deva, who was previously based at the City University of Hong Kong, told Al Jazeera.

“Businesses are increasingly being forced to care for human rights for a variety of ‘push and pull’ factors,” Deva added.

“However, these factors are not the same for all places and in all situations. For example, it may be easier for companies to leave Myanmar, than China.”

Hong Kong skyline.
Hong Kong’s government hopes an upcoming banking summit will signal the financial hub is open for business [File: Tyrone Siu/Reuters]

Some human rights experts have suggested that bankers, rather than staying home, could use their voice at the summit to draw attention to the situation in Hong Kong.

Last week, CFHK, as part of its advertising blitz aimed at the summit, projected images onto buildings in New York’s financial district urging executives to “speak out” if they do make the trip.

“It’s not such a clear-cut issue as attend or boycott, rather it’s about how executives can use their leverage and raise their voice to show concern about how the rule of law in Hong Kong is eroding,” Justine Nolan, a professor at the University of New South Wales (UNSW) who studies the intersection of business and human rights, told Al Jazeera.

“For example, an executive might attend but make a public statement about concerns or choose not to attend and associate their absence with concern about human rights and the rule of law in Hong Kong.”

So far, banks have given no indication of any intention to get involved in politics, although two executives have pulled out citing reasons not related to the controversy.

Barclays on Monday said that Chief Executive CS Venkatakrishnan would no longer be traveling to Asia due to changes in his schedule, after Citigroup last week announced Chief Executive Jane Fraser had canceled due to testing positive for COVID-19.

While Wall Street may prefer to stay silent on the controversy, companies are only going to find it harder to draw a bright red line between business and human rights, Nolan said.

“Look at the pressure on companies sponsoring the upcoming World Cup to contribute to a fund to compensate migrant workers for the losses they have suffered in the leadup; look at the pressure on Adidas to respond and take action on their relationship with Kanye West,” she said.

“Business has changed and public-facing companies and brands no longer have the luxury of turning a blind eye to environmental and human rights abuses.”

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