Return of the Returnees?: Dual Citizenship and Hong Kong’s Global Talent Base

The British (re)interpretation of the British National (Overseas) scheme in January 2021 prompted Hong Kong pro-Beijing politician Reginal Ip Lau Suk-yee to propose a ban on Hong Kong people holding Chinese nationality and citizenship in another country. Ip suggested that the Chinese central government and the Hong Kong Special Administrative Region (SAR) government have been turning a blind eye to the dual citizenship issue since 1997, when the British returned sovereignty over the territory to China. Intriguingly, Ip’s proposal has not received, at least for now, much support – even within the pro-establishment camp. But it served to put a spotlight on this vast and largely “invisible” group of Hong Kong residents, raising questions about how widespread dual citizenship is among residents of the SAR and why it matters.

The first question does not have an easy answer. There is no system to keep track of such “personal” information since Hong Kong residents need only use their identity card to pass through immigration. According to most recent estimates, there are 300,000 Canadian, 100,000 Australian and 85,000 American passport holders in Hong Kong. If those who may hold passports from the United Kingdom, Singapore and New Zealand, which were popular immigration designations for tens of thousands of Hong Kong people in the 1980s and 1990s, are included, it is possible that over half a million persons, or about 6.5 percent of the total population, hold dual citizenship.

Given the concern of foreign intervention in Hong Kong’s recent political turmoil, one might wonder why the government and the pro-establishment camp have not enthusiastically supported Ip’s proposed ban. This leads to the second question: Who are the people who hold dual citizenship?

Expatriates are certainly among the first that come to mind. As a global financial center, Hong Kong has one of the world’s highest percentage of expats in its population. According to the Hong Kong Council of Social Services, however, in 2018, there were only 41,592 expatriates in Hong Kong (not including domestic helpers from the Philippines and other Asian countries). They come from many different countries. In 2014, Canadians accounted for only 2.1 percent of the total expatriates in Hong Kong. From the size of the entire expat population and the percentage of expatriates from countries that have a high estimated number of citizens residing in Hong Kong, it is fair to suggest that most people who hold dual citizenship residing in the SAR are not expatriates but “return migrants” who had emigrated from Hong Kong but returned to live and work. Typically, these returnees have the cultural and social capital needed to resettle and reintegrate into local society.

To ensure a supply of high-skilled labor, the Hong Kong government expanded the higher education sector to nurture more human capital. The proportion of workers with post-secondary qualifications in the labor force increased from 20.4 percent in 1996 to 41.1 percent in 2016. Despite this effort, high-skilled global talent is still in demand. Relying on expatriates who tend to be highly mobile and do not have a strong commitment to the host city is not sustainable. Hong Kong inevitably has to look into the competitive global labor market to recruit high-skilled talent as immigrants with a stronger commitment to the city to fill high-end jobs particularly in the business, finance and technology sectors.

Hong Kong is historically a city of immigrants, most of whom came from mainland China. Today, the main inflow of immigrants to Hong Kong still come from north of the Shenzhen River. With 150 immigrants from the mainland allowed to cross the border every day to settle in Hong Kong, the SAR need not worry about its low fertility rate. Most of these arrivals, however, do not have qualifications that meet the demands of the labor market of the international financial center. Because of the SAR’s physical and cultural proximity to the mainland, the Hong Kong government has actively introduced different measures to recruit high-skilled immigrants from across the border. These include the Admission of Mainland Professionals Scheme and Immigration Arrangements for Non-local Graduates. As at 2016, Hong Kong had recruited 150,000 high-skilled talents from the mainland, but fewer than one-fifth of them stayed the seven years required to qualify for permanent residency.

So who are the return migrants – and why have the Chinese and Hong Kong governments and the pro-establishment camp hesitated, at least openly, to discuss prohibiting dual citizenship?

Return migration is not unusual, particularly with international transport and travel relatively convenient and affordable. There are many possible reasons why those who have emigrated decide to return and resettle back in their home country: Cultural maladjustment and the desire to retire in a socially familiar community are typical motivations. Maximizing economic gains is of course another common factor.

Hong Kong immigrants have often been portrayed as extremely wealthy, “millionaire migrants”, as The University of British Columbia geographer David Ley dubbed them. In reality, most are highly competitive, well educated, and young to middle-aged professionals. The Hong Kong SAR government is fully aware of the qualities of this large group of high-skilled “return-migrants”. In 2000, it conducted a survey to profile these individuals, the results of which confirmed that most returnees belonged to the top income categories and reported holding senior positions such as managers and administrators. Over half of them held university degrees. Many of the returnees from the early 2000s were already in managerial and leadership positions in different sectors before they emigrated from Hong Kong to other countries. To a large extent, their return helped fill the gaps that they themselves had created when they departed.

Since 2000, the wave of return-migration was further extended to second and 1.5-generation youths from Hong Kong immigrant families. (The term “1.5 generation” refers to those who immigrate to a new country before or during their early teens.) These young people, after completing their higher education, decided to return to Hong Kong to pursue their careers, particularly in the international financial and trade sectors. A few also joined the entertainment industry.

Many of them fit the profile of the high-skilled talents that are needed by Hong Kong. Educated in their host countries, these young people are fully assimilated in “Western” culture and are fluent in English. Many of them were raised in families that have preserved a strong Hong Kong culture and living style at home. They are culturally familiar and socially connected with Hong Kong, making them a potential group of international talent that the Hong Kong government, at least at one point, tried to recruit by introducing a scheme to encourage children of Hong Kong immigrants to return.

Nonetheless, due to political developments since 2014, a reverse-return of return migrants in Hong Kong has been happening. The recent political turmoil and the imposition of the National Security Law (NSL) have caused many Hong Kong people to consider leaving Hong Kong. While the media tends to focus on the rapidly emerging wave of emigration, the quiet departure of many returnees has yet to draw public attention in Hong Kong.

With dual citizenship, returnees are relatively mobile and have a convenient option if they decide to leave. Indeed, the Canadian Broadcasting Corporation (CBC) and other media outlets have noted the increasing number of returnees back to Canada. Last month, Reuters reported that in 2020 a record C$43.6 billion (US$34.9 billion) was transferred from Hong Kong to Canada, evidence that more Canadian returnees to Hong Kong have prepared to leave.

Ip’s proposal caused a few countries to issue warnings to their citizens in Hong Kong. Judging from the high attrition rate of students in international schools and schools included in the government’s Direct Subsidy Scheme to support private education, it would be surprising if this trend of reverse-return migration were limited to Canadians in Hong Kong. Although there is no information on how extensive reverse-return migration is and could be, departures will surely have detrimental effects on the high-end labor market and the economy of Hong Kong.

History could repeat itself, and the departed returnees might well return again when Hong Kong has politically stabilized. This is how the government has in part justified or mitigated the impact of the imposition of the NSL. Such optimism may be unfounded. Since 1949, Hong Kong has experienced two “exoduses”. The first happened in the 1960s, triggered by the social riots initiated by local communist groups and unions.

The second was in the 1980s and 1990s because of the political uncertainty caused by the signing of Sino-British Joint Declaration on the Question of Hong Kong in 1984 and, more importantly, the suppression of student movements in the mainland in 1989. Both periods of flight indicate that there is an inherent fear of Beijing among Hong Kong people, many of them or their parents having fled China after 1949. Whenever China’s interference in Hong Kong loomed or became palpable, people’s concerns mounted, driving them to emigrate.

There are many reasons why Hong Kong immigrants decided to return. No matter what their reasons were, the socio-political conditions in Hong Kong were a critical consideration. After 1997, the political situation in Hong Kong was relatively stable, and people still enjoyed a high level of freedom and respect of the rule of law, while China’s interference was relatively restrained.

Today, with the imposition of the NSL, Hong Kong may have crossed a political Rubicon. It is hard to tell whether the political stability that the NSL promises will be able to minimize people’s fears and keep returnees in Hong Kong. Also, given the worries about Hong Kong losing its economic appeal in the global financial market (though some major financial institutions have recently announced that they are boosting staff numbers and senior management placements in the SAR), it is hard to foresee that post-NSL Hong Kong will remain an attractive place for Hong Kong immigrants and their children to return for the purpose of maximizing economic gains. It appears that the issue of dual citizenship could resolve itself – with or without any move to ban it.