Deep ramifications of China’s market diplomacy

Max Burns, The Independent

Be careful what you say about the pro-democracy protests roiling Hong Kong: the Chinese Communist Party is always listening.

That warning may sound sensational, but for basketball fans and the 30 million players of Blizzard’s popular competitive video game Hearthstone, it isn’t far from the truth. That’s because China is engaging in an unprecedented push to leverage its massive domestic market power to silence critics abroad.

And it’s working – even in the United States. In case you’ve been lost at sea for most of 2019, Hong Kong erupted in protest in March after the government in Beijing announced controversial revisions to its criminal extradition laws. Going forward, the Chinese central government decreed, Hong Kongers accused of crimes would be sent to mainland China for trial. Such an idea is anathema in Hong Kong, which enjoys significant autonomy from the mainland.

Hong Kong’s pro-democracy rallies have been staggering in their size and durability. In late August, nearly 1.7 million people took to the streets to protest a sharp rise in police brutality. Wounded protesters have taken on the status of folk heroes. Hong Kongers’ outrage now targets something much more fundamental: the unjust use of Chinese state power to silence dissent.

An increasing number of protests have turned into violent clashes with security forces, straining Beijing’s patience at a time when Chinese Premier Xi Jinping would prefer to emphasize the unity of China’s 70th anniversary under communism. A growing number of human rights organizations fear Xi may toss caution aside and send in the military. Then the National Basketball Association got involved.

The Houston Rockets have a long history with Beijing. They recruited Chinese 7ft 6in basketball phenom Yao Ming in 2002, sparking what sports writers often refer to as basketball’s “Ming Dynasty.” Yao was and remains a cultural icon to Chinese people: in 2008, Yao carried the Olympic torch into Tiananmen Square to kick off the Beijing games.

That put Yao and the Chinese central committee in a tough position when Rockets general manager Daryl Morey tweeted a pro-Hong Kong image on Twitter last week, with the accompanying words, “fight for freedom, stand with Hong Kong.”

In normal times, Morey’s tweet would have garnered little reaction. But basketball fans on the mainland – China is the NBA’s second-largest market outside the United States – bristled at what they viewed as an American sowing disharmony in Hong Kong. The Chinese government suspended its ties with the league, threatening to tune out its 500 million basketball viewers at a cost of some $4 billion to the NBA.

Faced with the loss of its invaluable Chinese viewers, the NBA made a feint towards resistance before quickly capitulating to China’s demand that criticism of Hong Kong be held off-limits. NBA agents now advise their clients even more directly: there is “no upside to speaking out” in support of Hong Kong’s democracy movement. Such talk makes Beijing unhappy, and an unhappy Beijing means an unhappy NBA.

China’s use of its markets as weapons to enforce orthodoxy and limit criticism of Beijing’s antidemocratic policies may not be new, but it is brutally effective. Even in a free-speech bastion like the United States, for-profit corporations like NBA teams and video game publishers depend on a steady flow of Chinese revenue to keep the lights on.

Through it all, one constant China critic has been eerily silent: President Donald J Trump. Eager to wrap up the trade war currently destroying his re-election prospects, Trump promised Xi Jinping his silence on the Hong Kong protests. He hasn’t said a word about a hostile foreign government bullying American businesses into pushing anti-democratic Communist Party propaganda.

For a president who signed an executive order promoting pro-conservative “free speech zones” on college campuses, Trump’s silence in the face of direct Chinese aggression is an indication of just how narrow his view of free speech really is.

It isn’t just multi-millionaire NBA team owners feeling the heat of Chairman Xi’s displeasure – the $1 billion world of esports also felt the bite of Chinese market diplomacy this week. Esports, like basketball, has its superstars. One of the most popular is Chung ‘Blitzchung’ Ng Wai, a Hong Kong native who made his name in the Activision Blizzard competitive card game Hearthstone.

Activision Blizzard caused an international uproar after suspending Chung for a year – and seizing his prize money – after Chung shouted, “Liberate Hong Kong, revolution of our age!” during a Hearthstone competition streamed live around the world. The speed of Activision Blizzard’s punishment, video game industry journalists noted, may have something to do with Blizzard’s heavy investment in Chinese gaming companies and esports leagues.

In a connected bit of irony, Activision Blizzard also holds the rights to publish NBA-licensed basketball video games in China.

China’s market pressure is working: the NBA has been so thoroughly chastened by its run-in with Beijing that some of America’s richest businessmen – team owners – don’t dare speak out. And even as Activision Blizzard reduces Chung Ng Wai’s Hearthstone suspension, it publicly reaffirmed that Blizzard stands with its financiers in Beijing, not the activists in Hong Kong.

Congress has tried, in small part, to fill the leadership void left by Trump’s silence. Senator Ted Cruz travelled to Hong Kong last weekend, where he was largely ignored by protest leaders. There have been calls for the State Department to put pressure on Beijing to resolve protests peacefully – but so far, there’s no sign Secretary Pompeo wants to get serious.

If China is allowed to pursue its market diplomacy unchecked, the results won’t just muzzle Hong Kong – they will aggressively work to silence criticism from any company dependent on Chinese markets. The United States must resist every effort by Beijing to claim that ruinous power.

So far, Washington offers only silence.