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It was a misconcocted scheme from the start, but it is now deeply weird to think that less than a year ago a Hong Kong company made an attempt to take over London Stock Exchange Group.
Cast your mind back to the innocent pre-Covid days of September 2019, when HKEX shocked the City with a £30bn hostile bid for a British keystone of global financial infrastructure. The approach inevitably and swiftly failed for an array of financial and political reasons. LSEG boss David Schwimmer was left free to continue to pursue his own questionable megadeal with Blackstone for the data provider Refinitiv.
What makes this bizarre episode more incredible today is that the majority of HKEX's board are appointed by Carrie Lam, the woman who runs Hong Kong on behalf of the Chinese Communist Party. This was widely remarked upon at the time as a serious problem for the bid, but today it is much worse than that.
As of this weekend Lam and 10 other senior officials in the territory are the target of US property seizures and financial assets freezing orders over their role in the crackdown on democracy activists. So in a parallel universe where Britain's warm embrace of China continues under prime minister George Osborne and the HKEX bid for LSEG succeeded, the heart of the City is under the control of an individual subject to sanctions from our most important ally.
That would probably be a bit awkward, as the London Metal Exchange, which is already owned by HKEX in this universe, may soon discover.
Indeed, HSBC must be relieved that speculation that Laura Cha would be included in the list of sanctions targets proved off the mark.
She is a Hong Kong executive councillor and friend of Lam's. As well as being a senior politician in the territory, Cha is a non-executive director of HSBC and chairman of the unit that operates its Asia-Pacific business. It seems a safe assumption that being a US sanctions target would probably not be compatible with a seat on the board of a global bank.
Notably, Cha is also chairman of HKEX and part of the brain trust that authorised that doomed tilt at LSEG. It's a small world in Hong Kong, in which business and Chinese Communist Party politics are increasingly entangled.
But the fates of Hong Kong political elites and their offshore holdings are of relatively little importance next to the restrictions the Trump administration has ordered against Chinese companies. This is a pivotal moment for the West, in which foreign policy and industrial policy are being riskily mixed, as they are routinely in China.
Trump has given the viral video app TikTok, owned by Bytedance, and WeChat, a "super app" that offers everything from simple messaging to complex financial services and is owned by Tencent, 45 days to cease operations in the US unless they cut ties with their Chinese parents.
ByteDance, which arguably has more to lose given the massive popularity of TikTok with Western teenagers is already racing to sell it to Microsoft. WeChat is mostly used in the US to communicate and transact with friends and family in China, where it is ubiquitous. Nevertheless news of a US ban wiped as much as 10pc off Tencent shares in Hong Kong on Friday over concerns its games business, which is more lucrative in the West than WeChat, could be damaged too.
Trump has justified the bans as necessary to protect national security. This concept may not be as broad in the US as under Hong Kong's new laws, but it can still be stretched to political ends.
For many, the American attack on Chinese software, coming on the heels of its attack on Huawei and Chinese hardware, is more Trumpian maladministration. The President's crackpot demand for a cut of any price paid for TikTok adds to the sense of a shakedown.
That said there are legitimate concerns about TikTok's privacy and security standards. It might seem an unlikely vehicle for corporate and government espionage, but once installed on smartphones, apps can be exploited for all sorts of covert snooping. The reams of personal data handed over to ByteDance as a result of normal use of Tiktok could also be useful one day in some nefarious Beijing plot, according to the US. There is no public evidence of either and ByteDance denies it poses any threat.
And despite what genuine national security worries exist, the strong-arming of the company into a sale of TikTok can be best understood as a form of data mercantilism. The US is using its political power to seize advantage for its domestic tech industry, harm international competition and erect barriers to free trade. As a commodity, data is being barred from export.
The obvious irony is that mercantilism in many forms is fundamental to Chinese economic policy. It shuts out foreign businesses or forces them into partnerships with local counterparts who offer nothing of value except links to the Chinese Communist Party. It has maintained a cheap currency to drive export growth.
To many critics of the US's moves against TikTok and WeChat, Trump is foolishly mirroring China. The internet in the West should remain open to all to do business, they argue. They unwittingly espouse a version of the Osborne idea that trading and encouragement into our markets would gradually make Beijing see the light and open up.
It was always a nice theory. The democrats of Hong Kong and Uighurs of Xinjiang are subject to the reality, which is one of creeping control and mass surveillance. Trump's wrestle for TikTok is an unedifying spectacle, but China has no moral ground on which to stand.
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