Hong Kong is a small but densely populated city located in the southwest portion of China. There is some confusion over the status of this world-famous city. To which country does it belong? Actually, Hong Kong was part of the British Empire up until 1997, when the British government gave possession back to China.
However, Hong Kong is not completely under the control of the Chinese government, either. It is self-governing for the most part and this facilitates a semi-autonomous, pro-democracy spirit not seen elsewhere in China.
Naturally, Shanghai is where China’s government sought to establish a gold exchange, a platform for gold to be traded from all over the world. Many leading analysts use withdrawal numbers from the Shanghai Gold Exchange as a means for tabulating China’s gold demand approximately. It would be useful to include Hong Kong is this conversation.
The city is a key gold hub where exchanges also take place. It even has its own currency: the Hong Kong dollar (HKD).
A wave of protests last year swept through the region, stirring aggressive reactions by both the demonstrators and the authorities. These clashes grabbed headlines all over the world, as many feared violence as the inevitable result.
There has been some amount of upheaval as a result of the pro-democracy protests that occurred in the city last year. The citizens were upset that their local leader (like our mayors or governors), Leung Chun-ying (known as C.Y. Leung), was named directly from mainland China’s Communist Party. Protesters called for the governor’s resignation and blocked off the entire business district during a crucial holiday last fall.
Nothing came of the demonstrations, which also fell short of widespread violence or looting. (Police did spray them with pepper spray.) However, this past Chinese New Year a plethora of riots rocked the city again. 90 officers were injured in the incident.
This led to the surprising third-place finish for one of the men who incited the riot, Edward Leung Tin-kei. He represents the Indigenous Party, a group that wants to go further than the city’s pro-democratic Civic Party and actually establish an independent country. The Indigenous Party candidate had a strong showing, garnering over 15% of the vote in a four-way race. This lent credence to the idea that the protests and demonstrations are having an effect on Hong Kong’s political reality.
Hong Kong does enjoy some different rules than the rest of China. It is not as tightly governed and monitored by Beijing, but it remains mostly under the control of the Chinese Politburo (seat of government). Although it obviously shares cultural connections to China, Hong Kong’s society is more in line with a Western democracy than a communist republic. Therein lies the tensions between Hong Kong’s citizens and China’s central government.
How will this situation play out? Will even greater autonomy for Hong Kong change the city’s thriving gold market? Only time will tell its fate.
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