Fitch Ratings on Friday downgraded Hong Kong’s long-term foreign-currency issuer default rating (IDR) to “AA” from “AA+” with a “negative” outlook.
Months of persistent conflict and violence are testing the “One country, two systems” framework that governs Hong Kong’s relationship with the mainland, as mainland officials take a more public stance on Hong Kong affairs than at any time since the 1997 handover, Fitch said in a press release.
The agency expects the “One country, two systems” framework to remain intact but said the gradual rise in Hong Kong’s economic, financial, and socio-political links with the mainland implies its continued integration into China’s national governance system will present greater institutional and regulatory challenges over time.
In Fitch’s view, these developments are consistent with a narrowing of the sovereign rating differential between Hong Kong and mainland China (A+/Stable).
Ongoing events have also inflicted long-lasting damage to international perceptions of the quality and effectiveness of Hong Kong’s governance system and rule of law, and have called into question the stability and dynamism of its business environment, Fitch said.
The potential for renewed eruptions of social unrest could further undermine confidence in public institutions, and tarnish perceptions of the city’s governance, institutions, political stability, and business environment, it added.
On Wednesday, Chief Executive Carrie Lam Cheng Yuet-ngor announced that the controversial extradition bill would be completely withdrawn. However, protesters have continued to take to the streets across different districts as they demand an independent investigation into police ‘abuses’ and universal suffrage.
Call for Congress to pass HK bill
Citizens linked to Lihkg.com, an online discussion group, have called for a protest at Edinburgh Place in Central at 2pm on September 8 (Sunday) to urge the US Congress to discuss and pass the Hong Kong Human Rights and Democracy Act on September 9, US time. Participants will then march to the US Consulate General on Garden Road.
Citizens said they won’t apply for a letter of no objection from the police – but the rally would be peaceful, although police may call it an illegal assembly. Some netizens said they would hold US national flags, English banners and photos of prominent Congress members, and sing the US anthem.
They said the US should cancel its special status for Hong Kong and freeze the US assets of Hong Kong and Chinese officials and politicians who threaten the city’s autonomy and human rights. Netizens also urged the US to ask Beijing to allow Hong Kong to have genuine democratic rights.
According to the Public Order Ordinance, people are required to get an official notice of “no objection” from the police before they can legally protest in public areas. A protest without a letter of no objection can be treated as illegal assembly, under local law.
Over the past few weeks, police have banned many protests, including a large-scale march planned by the Civil Human Rights Front on August 31.
On August 31, thousands of protesters rallied from Wan Chai to Sai Wan without permission. To avoid a clash with riot police near the central government’s Liaison Office in Sai Wan, they returned to Admiralty and had a standoff with police near the government headquarters. The police fired tear gas and rubber bullets at the protesters and deployed two water cannon vehicles. Protesters threw bricks and fire bombs. Riot police charged slowly, so protesters were able to leave the site.
However, in the late evening, riot police charged into a MTR train in Prince Edward station and beat up passengers, who they believed were “rioters.” They arrested 40 people. Some 46 people were injured.
In July, citizens completed an online petition to urge the US Congress to pass the Hong Kong Human Rights and Democracy Act.
On Wednesday, Nancy Pelosi, speaker of the US House of Representatives, urged the Hong Kong government to do more to fulfill the “legitimate aspirations” of the Hong Kong people, including universal suffrage and an investigation into police violence.
Pelosi said members of Congress “look forward to swiftly advancing the bipartisan Hong Kong Human Rights and Democracy Act to reaffirm the US commitment to democracy, human rights and the rule of law in the face of Beijing’s crackdown.” Democrats and Republicans “stand united” in backing Hong Kong people’s pursuit of democracy, she said.
But Chinese foreign ministry spokesman Geng Shuang said on Thursday that US lawmakers should stop interfering in Hong Kong affairs and abandon the bill as the issue was purely China’s internal affair.
The Global Times said China would hit back if Congress passes the Hong Kong Human Rights and Democracy Act and the retaliation would not be limited to trade, according to an editorial published on September 2.