How China Holds Sway Over Who Leads Hong Kong

While the race for Hong Kong’s chief executive looks a lot like any major mayoral election, the choice doesn’t rest with the city’s 3.8 million voters. It’s decided by an electoral college of 1,200 business and political elites, including nine billionaires worth more than $100 billion. China can veto any winner it doesn’t like.

The system so heavily favors China that protesters occupied large swaths of the former British colony in 2014 in a successful bid to block a proposal for direct elections using the committee to screen potential candidates. This year’s vote on March 26 may test the limits of that system. China’s apparent favorite, former Chief Secretary Carrie Lam, is facing a more popular challenger, former Financial Secretary John Tsang.

Here’s a Closer Look at How the Committee Works

The electors represent key industries, professions and social sectors selected by the British in their scramble to set up democratic institutions in advance of Hong Kong’s return to China in 1997. The privileged few—comprising 0.03 percent of registered voters—include about 300 representatives of government bodies.

This group provides China a strong base of support, since loyalists dominate the systems that put the politicians in office. Among them are 87 local representatives to China’s national legislature and top political advisory body, whose members are vetted by the ruling Communist Party.

Still, the election remains the closest thing to a public vote for an executive post in China. The government’s supporters justify the system as a bridge toward more direct elections in Hong Kong.

Electoral Influence vs. Economic Impact

The remaining 900 electors are chosen from three broad sectors: industrial, commercial and financial services; professions; and labor, social, and religious groups. While most of the seats are elected, turnout in those votes has never broken 50 percent. One-quarter of open seats were either uncontested or settled through negotiations within the subsectors.

The committee is far from “broadly representative” as required by Hong Kong law, with women comprising less than 17 percent of the 1,194 certified members. Some groups’ influence far exceeds their contributions to the Asian financial hub’s economy, while others go unrepresented.

The 154 registered voters from the fisheries and agriculture subsector, for example, have 60 seats on the committee. That’s twice as many as accounting, which has 26,000 voters. One fisheries elector told Bloomberg in 2014 that messages about China’s preferred choice were circulated in the election committee ahead of the 2012 vote, although he said he was never explicitly told who to vote for.

Homegrown Fortunes

The system of giving votes to business interests has been blamed for perpetuating inequality and the world’s most expensive property market, with a median-income household needing almost two decades of wages to buy a home, according to consulting firm Demographia. The committee’s nine wealthiest members have about $109 billion in holdings, according to the Bloomberg Billionaires Index, or more than one-third of the city’s economic output.

Developers dominate the list of Hong Kong’s richest, with the flagship companies of five of the committee’s billionaires deriving most of their wealth from real estate in China and Hong Kong. An exception is Li Ka-shing, Hong Kong’s richest man, whose global empire-building efforts mean he gets a majority of his sales from overseas.

Tilting in China’s Favor

To reach the final vote, contenders must secure public nominations from 150 committee members by a March 1 deadline. While that bar is low enough to let pro-democracy groups contest the election, their candidates were both crushed in the past two campaigns.

The lopsided victories for establishment-backed candidates contrast with elections for the city’s legislature, where opposition candidates have drawn most of the overall vote. After the 2014 Occupy protests vented popular anger over the election process, the pro-democracy camp chose not to endorse a candidate this time.

Pro-Democracy Groups Gain Ground

Still, divisions in the political establishment can lead to surprises. The apparent favorite in 2012, former Chief Secretary Henry Tang, saw support collapse after a scandal over renovations to his home. He lost to Leung Chun-ying, another China-backed contender. Leung was elected with 689 votes, a number that became a derisive nickname for his lack of popular support.

Democrats could exploit a similar split this year, after securing a record 325 seats on the committee. Rather than field a candidate of their own, they helped get two others on the ballot: Tsang, the former financial secretary; and an ex-judge, Woo Kwok-hing. Tsang’s popularity makes him a wildcard in the final vote, which is anonymous.