The BlackRock-CK Hutchison Flop Isn’t Hong Kong’s Fault: It’s US-China Power Games
The failed port deal screams US-China rivalry, not a failing Hong Kong business scene.
The now-aborted BlackRock-CK Hutchison deal first announced in March 2025, where Hong Kong-based CK Hutchison was set to sell 43 ports across 23 countries to a BlackRock-led consortium, has been cast as a sign of Hong Kong’s business environment circling the drain.
Beijing’s loud opposition killed the deal by the end of March, and commentators have been quick to lament the death of Hong Kong’s freewheeling capitalism. But this narrative misses the forest for the trees.
The real story isn’t Hong Kong’s decline; it’s the predictable flexing of great power rivalry between the US and China, where national security trumps1 corporate freedom on both sides of the Pacific.
The Deal That Never Was
In early March, CK Hutchison, the sprawling conglomerate built by Hong Kong tycoon Li Ka-shing, announced it would sell a portfolio of 43 ports in 23 countries to a BlackRock-led group. These weren’t just any ports; they included critical nodes like those at both ends of the Panama Canal. Beijing, unsurprisingly, wasn’t thrilled, with Chinese state media and officials framing it as a matter of national security. By the end of March, the deal was dead.
Western analysts pounced, arguing this was proof of Hong Kong’s eroding autonomy, where businesses can’t make deals without Beijing’s say-so. The New York Times summed up the vibe:
“The concern among business leaders cuts to the heart of the question facing Hong Kong: Are its companies free to make their own business decisions, or must they consider China’s broader national interests as do mainland Chinese firms?”
But let’s flip the script. Imagine BlackRock, the $12 trillion asset management behemoth based in New York, trying to sell those same 43 ports, including each port on both ends of the Panama Canal, to HK-based CK Hutchison.
Picture the reaction in Washington. A hypothetical Truth Social post from Trump would likely read:
“Commie Larry Fink just handed over BOTH ENDS of the Panama Canal to CHINA, a DISASTER for national security!! The Radical Globalists NEVER cared about America, only PROFIT. BLACKROCK is a GLOBALIST NIGHTMARE. They should be investigated IMMEDIATELY. America Last?? NOT ON MY WATCH!!!”
Sound familiar? It’s practically a mirror of Beijing’s editorials on the CK deal. Trump, known for his scorched-earth approach to opposition2 would likely move heaven and earth to block such a sale, constitutionality be damned. Obama details Trump’s tactics.
Great Power Rivalry, Not Local Failure
The symmetry between Washington and Beijing here is the point. If the US and China both squash deals in favor of national interest, the issue isn’t Hong Kong’s business environment. It’s the global reality of great power competition.
The US and China are two superpowers locked in what Graham Allison calls “the fiercest rivalry in history,” competing across technology, military, economy, politics, and global influence.
When ports—literal chokepoints of global trade—are on the table, neither side is going to let the other gain an inch. BlackRock ($12 trillion in assets) and Li Ka-shing (“Superman” of Hong Kong business) are just collateral damage in this geopolitical cage match.
Both Trump and Xi prioritize national and economic security over the free market. Trump’s tariffs, which roiled markets, cost American shareholders dearly in early April. Meanwhile, China’s industrial strategy of building monopolies in chips, solar panels, batteries, and among other products gives it leverage to weather trade wars.
In 2023, we wrote about the massive dependencies on China that the rest of the world has developed for its modern way of life, how Beijing deliberately sought to create these dependencies, and how this would allow China to assert its will with the West.
"China wants to be TSMC, but a hundred times bigger. They want to be the source for everything the world needs. Chips, solar panels, batteries. You name it. Because if everyone needs you, you have leverage. Real leverage.
As the world’s foremost and largest manufacturing cluster, i.e. the factory of the world, China’s primary comparative advantage is hardware, and what Beijing most wants are industrial monopolies like TSMC."
Beijing’s resistance to Trump’s tariffs, coupled with its pivot to high-value manufacturing and outsourcing low-end assembly to Southeast Asia, shows it’s been playing the long game since its first trade war during Trump’s first term.
In late April 2025, while Trump seemed to be manifesting for a trade deal with China by claiming ongoing trade negotiations, Beijing refuted this, signaling confidence in its position.
Hong Kong’s Still Got It
So why isn’t this failed BlackRock-CK Hutchison port deal a death knell for Hong Kong? Because the city remains a top 3 global financial hub: #1 in Asia, #3 globally. HK traders can still short US markets, e.g. with the inverse ProShares Short S&P500 ETF (SH)3 and its juicy 5% dividend yield, and invest globally.
Global traders can do this because US-China tensions are extremely unlikely to boil over into direct conflict. The stakes are too high; Trump’s refusal to commit to defending Taiwan underscores the mutual deterrence.
Hong Kong’s business environment thrives not because it’s immune to Beijing’s influence but because it’s a gateway to China’s economic engine. Similarly, New York benefits from being the financial heart of the US, despite Trump’s whims. Both cities are tethered to their respective superpowers, and that’s a feature, not a bug, in a bipolar world.
The Playbook for a Bipolar World
With this unprecedented global rivalry, neutrality sounds appealing but isn’t as great as it sounds. During World War II, neutral Switzerland and Sweden flourished while belligerents suffered. But in a cold war for global supremacy, aligning with a superpower is the smarter bet.
The US and China drive innovation, host the biggest companies, create the most advanced technology, and wield unmatched influence.
Sandwiched in the middle between these two great powers, the Singapores of the world depend on the good graces and friendship of these superpowers, which, as Trump has shown, can be withdrawn at any time.
Singapore's Prime Minister Lawrence Wong inherently understands this:
"I've said before that the world is changing in ways that will disadvantage small, open economies like Singapore. [...]
If other countries adopt the same approach as the US, abandoning the WTO and trading only on their own preferred terms country by country, it will spell trouble for all nations, especially small ones like Singapore. We risk being squeezed out, marginalized, and left behind. (emphasis added) [...]
We cannot expect that the rules which protected small states will still hold."
Superpower-based cities like Hong Kong and New York, embedded in their respective spheres of influence, are better positioned to ride the wave of protectionism and obsession with national power.
China’s edge lies in its state capacity and industrial policy, which outstrip the US’s fragmented approach. Beijing’s focus on dominating high-value supply chains, while preaching free trade to win allies, contrasts with America’s tariff-driven isolationism. Yet the US remains a financial juggernaut, with liquid markets and innovation hubs that keep it highly competitive.
For investors, Hong Kong offers proximity to China’s growth, while New York provides unmatched liquidity, trading opportunities (particularly on the short side), and access to capital. Neither is perfect, but both are and will be resilient because they’re anchored to the world’s two biggest economic engines.
The Takeaway
The BlackRock-CK Hutchison deal’s collapse isn’t a Hong Kong problem; it’s a symptom of a world where Washington and Beijing call the shots. Both nations are converging on a model where national security trumps corporate freedom, and their leaders, Trump and Xi, aren’t shy about flexing that power.
Hong Kong’s business environment isn’t dead; it’s just adapting to the same realities New York faces. The real lesson is that in this rivalry, no one’s fully free—not BlackRock, not Li Ka-shing, and certainly not the markets. But for those in Hong Kong or New York, the game’s still worth playing, because the biggest players are on your side.
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