Anti-government protesters forced Hong Kong’s international airport to suspend check-in services for the second day running on Tuesday, hitting the territory’s main airline Cathay Pacific as the Asian financial centre experiences its worst political crisis in decades.
Cathay, Hong Kong’s flagship carrier, cancelled flights and advised passengers to postpone all non-essential travel because of the anti-government demonstrations, which have sparked fears Beijing might intervene directly in Hong Kong to halt the unrest.
The airline has also come under pressure from China’s airline regulator after some of its staff were linked to the protest movement, a sign of Beijing’s growing readiness to make high-profile businesses choose between incurring the wrath of either the mainland government or Hong Kong protesters.
Shares in Cathay, owned by the Hong Kong and London-based Swire Group, have dropped 7 per cent in two days. The broader Hang Seng index has lost 9 per cent so far this month amid a sell-off in Hong Kong-focused stocks and those at risk from political fallout from the protests.
There were angry scenes and shoving matches in the airport on Tuesday as protesters used luggage trolleys to barricade the departure gates and tried to stop passengers from going through. Hong Kong airport’s website showed more than 300 flights as cancelled.
“Their problem is with the government, not with us,” said one angry passenger who declined to give his name.
Many passengers complained of changing flights four times and sleeping in the airport overnight. “They are just kids. They have nothing better to do,” said another frustrated traveller.
Cathay and Swire, which has roots dating back into colonial times, have come under sustained pressure from Beijing and China’s airline regulator in recent days after its staff were connected to the demonstrations.
ICBC, China’s largest state-owned bank, downgraded its rating on Cathay’s shares to a strong sell. Zhao Dongchen, analyst at ICBC, wrote that Cathay had a “PR crisis” after it was warned by China’s Civil Aviation Administration last week to suspend “overly radical” air crew.
Since last Friday, Cathay has also been required to submit a list of all flight crew to the Chinese regulator for flights that will enter mainland Chinese airspace. The “vast majority” of Cathay’s routes cross mainland China, Mr Zhao said, arguing that a failure to comply with the CAAC’s demands would cause “irreversible damage” to the Hong Kong airline.
Cathay said after market close on Tuesday that it had suspended a second pilot for misuse of company information and had begun internal disciplinary proceedings. It has already fired two airport employees and suspended another pilot for conduct linked to the anti-government protests.
“We resolutely support the Hong Kong government, the chief executive [the territory’s leader, Carrie Lam] and the police in their efforts to restore law and order,” Swire said on Tuesday. “We condemn all illegal activities and violent behaviour.”
The protests, which started with opposition to an extradition bill that would have allowed criminal suspects to be tried in mainland China, have expanded to include demands for the full withdrawal of the proposed law and for democratic reform.
An infuriated Beijing has stepped up its threats to the protesters, saying they are showing “signs of terrorism”. This week, state-owned media have run videos showing scores of trucks purportedly carrying paramilitary riot police massing on mainland China’s border with Hong Kong for “exercises”.
Steve Vickers, chief executive of Steve Vickers and Associates, a risk consultancy, and a former head of the Hong Kong police criminal intelligence bureau, said companies in Hong Kong should start “contingency planning in the event of PRC [People’s Republic of China] overt intervention”, which included “physical intervention or perhaps a curfew situation”.
An intervention from Beijing could spell the end of the “one country, two systems” formula under which Hong Kong’s special freedoms were guaranteed when it was handed over by the UK to China in 1997, analysts say.
Tuesday’s protests were the fifth consecutive day of demonstrations at the airport, the world’s third busiest international hub by passenger traffic.
Protesters completely shut down the airport on Monday afternoon, the first time political activity had forced its closure since the 1997 handover. Most protesters left the airport on Monday evening amid fears that police were about the clear the area by force but returned on Tuesday, when they began blocking some passengers from departing.
Mr Vickers said Beijing would be unlikely to permit the “current instability” to persist until the 70th anniversary of the founding of the People’s Republic of China on October 1. “This date may be a ‘drop dead’ deadline,” said Mr Vickers.
Monday and Tuesday’s protests at the airport were aimed at highlighting alleged cases of police brutality during demonstrations elsewhere in the city at the weekend.
The UN said on Tuesday it had “reviewed credible evidence of law enforcement officials employing less-lethal weapons in ways that are prohibited by international norms and standards”, noting that police fired tear gas into crowded and enclosed areas directly at individual protesters “creating a considerable risk of death or serious injury”.
Some protesters have argued that halting flights out of Hong Kong will lead to economic damage which they hope will bring the government to the table to address their demands.
Responding to the latest protests, Canadian prime minister Justin Trudeau on Monday said his government was “extremely concerned” about the situation in Hong Kong.
Chris Tarry of aviation consultancy CTAIRA said “a disruption of this scale could be a major setback” for Cathay.
“Cathay has been undergoing a turnaround programme and the last set of results showed it is making progress. Critical will be what happens with forward bookings as they are a major source of cash for airlines,” he said.
Additional reporting by James Kynge in Hong Kong and Sylvia Pfeifer and Naomi Rovnick in Londonhong kong
