Is Hong Kong really over? Warning China about a deal with Trump

Or has US economist Stephen Roach changed his mind about Hong Kong’s survival and identity?

Synopsis: Every month, The Straits Times gets its US Bureau Chief to analyse the hottest political and geopolitical talking points.

In this episode, US Bureau Chief Bhagyashree Garekar chats with Dr Stephen Roach, a prominent economist with expertise on Asia.

He spent three decades at global investment bank Morgan Stanley, serving as the firm's chief economist and later as chairman of Morgan Stanley Asia. He is currently a Senior Fellow at Yale Law School's Paul Tsai China Center.

In this wide-ranging conversation, he says the “unfriendly takeover” by mainland Chinese has changed the character of Hong Kong dramatically. This has left the market-based city - once idolised by iconic American economist Milton Friedman - in tatters, he adds.

While that might drive his critics crazy, the idea that his remarks are rooted in any bias against Hong Kong is “absolutely ludicrous,” he insists.

Roach also has a word of caution for China’s President Xi Jinping, who made a state visit to Washington for a summit with US President Donald Trump in September 2026.

The concept currently favoured by both the US and China to define their relationship - constructive, strategic stability - is also a bit of a mirage, he says. “There's nothing strategic about it, the best I think the Chinese can hope for would be stability,” he adds.

Roach is not among those anticipating a turning of the page with the Nov 3 midterm elections, even if the Democrats seize a majority in the Congress.

Roach also takes an axe to Trump’s frequent assertions of America being the “hottest economy”. “He calls it an “exaggeration” that also reflects the poor state of growth elsewhere in the world.

But a Great Depression-scale collapse is not in the cards, according to him. “I don't think we're gonna have a replay of the 1930s-styled bank-driven collapse,” he says.

Highlights (click/tap above):

00:50 "Hong Kong is over?": Stephen Roach clarifies the controversial headline in a Financial Times column in 2024

6:40 What’s not going right between the US and China?

7:40 Why Trump’s “shallow thinking” on AI hurts

10:28 His warning to China about a deal with Trump

14:00 Will a strong Democratic show in the Nov 3 midterm elections constrain Trump?

18:10 Is Trump’s claim of a "golden age” for America true?

24:20 As the 100th anniversary of the Great Depression nears, could there be a repeat?

30:00 Will US dollar primacy be seriously challenged?

33:00 When he sees China coming out of the slowdown

38:20 Lastly, on India: Will its economy continue to over-promise and under-deliver?

Read Bhagyashree Garekar’s articles: https://str.sg/whNo