March 27, 2017 / 7:54 AM / 4 months ago

Hong Kong’s first female chief starts from behind

3 Min Read

Newly elected Chief Executive Carrie Lam (R) meets current leader Leung Chun-ying in Hong Kong, China March 27, 2017.Bobby Yip

HONG KONG (Reuters Breakingviews) - Hong Kong has its first female political leader in Carrie Lam, elected on Sunday by a 1,194-strong committee of mostly pro-Beijing loyalists. The career bureaucrat charmed local elites, but is otherwise unpopular. As growth slows and a wealth gap widens, Lam's plans to loosen the city’s purse strings might buy a few hearts. But the real test will be buttressing the rule of law. Pushing back against the forces that got her elected appears mission impossible.

This leadership race - the first since massive pro-democracy protests ended in stalemate in 2014 - was never going to be a popularity contest. But any pretence of democracy has been dropped. For the first time since the ex-British colony was returned to China in 1997, the winner lost the pre-election poll. Only 30 percent of the non-voting public polled by the University of Hong Kong said they would vote for Lam, compared to 56 percent for ex-finance minister John Tsang, who had said he would seek to introduce universal suffrage. Past leaders, including divisive former chief Leung Chun-ying, fared better than Lam.

Graphic: Unloved Lam: reut.rs/2n8xXPq

Starting from such a low base, Lam could surprise on the upside. Growth is at seven-year lows and salaries aren't keeping up with housing prices. But the territory's economy isn't performing too badly, and its finances are in good shape after running budget surpluses since 2004-05. Lam’s pledges to lower taxes for small companies and invest in education could win support; ditto for plans to boost land supply to address the housing squeeze. If she delivers more social spending, she could earn credit for addressing the city’s economic divide.

More difficult for her will be to resist Beijing’s erosion of the rule of law in the territory, which has a separate, stronger legal system. In her victory speech Lam stressed she enjoys China’s trust. To repay that trust she may ignore calls for universal suffrage, push through controversial anti-subversion laws or look away while secret mainland police drag people Beijing doesn't like across the border.

A bit of bread and circus spending may indeed help maintain stability in the financial centre. But this alone won’t do. Transparency and a trusted legal system are essential for Hong Kong to thrive.

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