Hong Kong: What to Watch For From China


We could see massive movements in the markets if China makes any moves.  Geopolitical analysts at Stratfor says we should watch the following:

Watch the actions by mainland officials: “When top Chinese leaders emerge at some point in the next two weeks from their summer retreat in Beidaihe, their statements will indicate how they intend to approach Hong Kong,” Stratfor writes, “Any move to convene a National Peoples Congress standing committee, which would be the body that would debate imposing a curfew in Hong Kong, would be a strong indicator that an intervention is imminent.”

Watch the movement of mainland forces: “Any movements of the large forces purportedly gathered in Guangdong province to mark the 70th anniversary of the founding of the Peoples Republic of China or of the armed police stationed in Shenzhen should be monitored.”

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Watch the protesters responses: Stratfor notes that, though Beijings ongoing warnings that it might intervene could persuade protesters to act with more restraint, it is more likely to provoke them to stay the course. “Any intensification of unrest would make an intervention more likely.”

Watch the responses from abroad: “Some in the United States, such as Senate Majority Leader Mitch McConnell, have suggested sanctioning Beijing in the event of a violent crackdown on protesters in Hong Kong, though US President Trump has said Hong Kong is an internal matter for Beijing. “Officials have also suggested that Hong Kong could lose its special trade and customs regime in the event of a crackdown, though opinions on this are divided because doing so would also cost the United States,” Stratfor says, “if the United States did proceed, Hong Kong would stand to lose a great deal from US tariff measures, which would harm its currency and financial markets, and in the long term, its status as a financial hub.”

Watch the market reaction: “Even though Beijings intervention might end the protests in the short term, the prospect of direct intervention by Beijing will further rattle the territorys economy, which has already been rocked by the weeks of violence,” and “given Hong Kongs position as a world financial center and a critical financial link to the outside world for Beijing, any serious financial disruptions would harm mainland and territory alike.”



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