‘Made in Hong Kong’: Deriving value from the place-of-origin label, 1950s and now

Abstract

Focusing on soy sauce exports from Hong Kong to the United States, this article traces the origin of the ‘Made in Hong Kong’ label to the US-led embargo on Chinese goods during the Korean War and explores the repercussions the recent Sino-US conflict generated on the label. By examining the history of an enterprise embroiled in two episodes of global trade disruptions, this article reveals how politically motivated US trade policies steered businesses in Hong Kong to pursue commercial opportunities by leveraging geopolitics, both global and local. Strategically capitalizing on Hong Kong’s position during the Cold War that allowed local exports to the United States, Hong Kong entrepreneurs created an international product chain. When the latest Sino-US trade war erupted, Trump’s elimination of the distinction between China-made and Hong Kong-made exports coincided with a wave of local consumerism in Hong Kong and unintentionally imbued meaning into homegrown products. From a commercially expedient marker aimed at satisfying the US government’s anti-China trade requirements, the ‘Made in Hong Kong’ label has recently been repurposed as a badge of local pride and perseverance as Hong Kong/mainland tension escalated. Necessitated by global trade policies and infused with connotations of shifting geopolitics, the malleable ‘Made in Hong Kong’ label signified not only reactions to US policies but also fluid Hong Kong/China relations. In successive rounds of US-initiated trade disruptions, the place-of-origin label reflected Hong Kong’s changing place in global geopolitics and the city’s position vis-à-vis the PRC.

Introduction

Focusing on soy sauce exports from Hong Kong to the United States, this article traces the origin of the ‘Made in Hong Kong’ label to the US-led embargo on Chinese goods during the Korean War and explores the repercussions the recent Sino-US conflict generated on the label. The decades-long history of ‘Made in Hong Kong’ soy sauce involved the globalization of foodways and local perception of Hong Kong’s products. Rather than exploring the taste for Hong Kong-produced soy sauce overseas, this article focuses on Hong Kong responses to shifts in US trade regulations governing its import and the rejuvenation of local interests to homegrown products during the recent episode of Sino-US rivalry. Using Hong Kong trade statistics, as well as documentary and oral history sources, this study focuses on the development of the local soy sauce industry, and in particular one sauce maker Koon Chun (冠珍), as they came to be embroiled in two episodes of disruption in global trade.

‘Made in Hong Kong’ had its origin as a place-of-origin signifier in response to a political exigency. Initially a product for the small local market, Hong Kong soy sauce had made only a limited foray into the export market before the Second World War. However, the then British colony had served as a trans-shipment point for soybeans, the sauce’s main ingredient, which were sourced primarily from northeast China. As Cold War tensions intensified, the US embargo disrupted Hong Kong’s trade in soy and soy products. Leveraging their overseas connections and a trade regulation provision allowing Hong Kong soy sauce exports to the United States, Koon Chun and other Hong Kong entrepreneurs redirected the product’s flow. Importing the requisite volume of US soybeans for processing into soy sauce, sauce makers in Hong Kong were able to circumvent the embargo. Soy sauce manufacturing became a value-adding industry that strategically utilized the city’s geopolitical position as a British colony connected to mainland China to develop business opportunities overseas. Responding to the disruption caused by US policy, Hong Kong businesses capitalized on the city’s liminality during the Cold War and fashioned an international product chain.

Only after decades of escalating exports to the United States did ‘Made in Hong Kong’ come to be infused with local significance. Sales of Hong Kong sauce in the US export market expanded during the Cold War era in the context of the colony’s overall export growth.¹ With its connections to the American markets, Koon Chun capitalized on geopolitical exigencies and expanded their business alongside other sauce makers. After decades of bustling export activities, the Trump administration’s intensifying aggression towards US trade with China introduced new business dynamics for Hong Kong soy sauce makers. In the absence of punitive tariffs, the recent Sino-US trade war has not inflicted financial damage on Hong Kong’s export business but has coincided with a wave of local consumerism as the city’s tension with mainland China heightened. In concert with the rising appeal of homegrown products, Koon Chun and other local soy sauce makers turned their attention to the local retail market to avail themselves of the business opportunities afforded by the new nativist sentiments.² Drawing attention to their increasingly untenable insistence on producing in Hong Kong, Hong Kong sauce makers strike a chord with local consumers who feel increasingly marginalized in their hometown.

In both cases of escalating tension between the United States and the People’s Republic of China (PRC), politically motivated US trade policies steered businesses in Hong Kong to pursue commercial opportunities by leveraging geopolitics, both global and local. US-initiated trade disruptions precipitated connotations of the ‘Made in Hong Kong’ label in terms of the city’s position vis-à-vis the PRC, and the response in Hong Kong reflected not only reactions to American demands but also fluid Hong Kong/China relations. Necessitated by global trade policies and infused with connotations of subsequent geopolitical shifts, the malleable ‘Made in Hong Kong’ label did not exude product superiority to its consumers overseas. Instead, the signifier expressed different ‘identities’ for Hong Kong products in response to commercial exigencies or cultural preferences—first as non-mainland Chinese products and hence politically acceptable imports in the eyes of the United States, and more recently a symbol of home turf to Hong Kong consumers.

Through an exploration of the business development of sauce making with a focus on its development at two historical moments, this article reveals the repurposed utility of the ‘Made in Hong Kong’ label and explores global connections of local history. From its humble beginnings as a budding export business to the recent emphasis on local consumers, Hong Kong soy sauce underscores the impact of global, regional, national, and local events on the production and consumption of a food product that has contributed to the city’s economic vibrancy and now reflects the city’s latest predicament. Originating as a commercially expedient response to Cold War politics, the place-of-origin label has become a badge of local pride and perseverance for a city in search of its place in the latest round of geopolitical flux.

Shifting role in product chain: From soybean traders to soy sauce manufacturers

By the early twentieth century, soybeans were being widely cultivated across East Asia, with those from northeast China considered to be of the best quality (TNA FO371 9221). In Hong Kong, however, soybean products were not popular with consumers despite being hailed as the answer to China’s nutritional and developmental problems by Chinese elites and Western medical professionals alike (Prodöhl 2013). In his report on ‘Nutrition in Hong Kong’ in 1939, the colonial governor spoke of the initial unpopularity of soybean products: ‘the Southern Chinese are rather inclined to look down upon [the] soya bean as a food for pigs’ (TNA CO859/33/2). In spite of its limited local consumption, soybeans spawned an active trading market in Hong Kong, which handled robust shipments of the commodity into and out of the British colony before the Second World War (Figure 1).³ In the 1930s, shipments from ‘North China’ (read Manchuria, which was then under the control of the Japanese empire) dominated the soybean import market in Hong Kong. In turn, the colony shipped the commodity to Macao and such destinations in Southeast Asia as Malaya, the Philippines, and French Indochina (Hong Kong Trade Returns, 1932–40).

Source: Hong Kong Trade Returns.

Figure 1. Hong Kong trade in soybeans and soy sauce before the Second World War.

By comparison, soy sauce production was only a young industry in pre-war Hong Kong. Although a handful of soy sauce makers had set up operations in Hong Kong in the 1910s (Hong Kong Commercial Daily 2013; Sing Pao 2014; Apple Daily 2013), their presence remained insignificant (Chan and Chan 1941, 255).⁴ New entrants in the late 1920s, among them industry titan Amoy (which opened a factory in Hong Kong in 1929 [The Amoy Canning Corp. n.d., 1]) and budding producer Koon Chun (established in 1928), invigorated the industry. Together with manufacturers of preserved fruits, certain soy sauce companies organized a guild in 1936 ‘to maintain accounts and to promote business’ (Kung Sheung Morning News 1936; Chinese Mail 1936a, 1936b; HKPRO HKRS837-1-192). The following year, industry workers also formed a union for ‘mutual assistance’ (HKPRO HKRS837-1-275). By 1936, soy sauce was a sufficiently noteworthy trading item to earn it a separate entry on the cargo lists of ships bound for US ports (Hongkong Chamber of Commerce Monthly April 1936, 1–12, 91). Following its gradual growth in the 1930s, soy sauce exports totalled HK$735,000 in 1940 and continued to trail behind soybean exports in value. Of that total, exports to the United States accounted for 52 per cent in 1940, the last full year of British control before the Japanese occupation of Hong Kong (Hong Kong Trade Returns, 1932–40) (Figure 1).

While no data are available for the years immediately after the conclusion of the Second World War, the returning British colonial regime was logging robust growth in the soybean trans-shipment market by 1949, with imports having more than doubled from their pre-war high to exceed HK$8 million. Despite disruptions in certain months, imports from North China represented the overwhelming majority of the soybeans shipped to Hong Kong in 1949 and 1950, the communist takeover of the mainland notwithstanding. The situation took a dramatic turn for the worse thereafter, as imports from the mainland ground to a halt, with no shipments at all registered between April and July of 1951 (Hong Kong Trade Returns, 1949–51).

The PRC’s entry into the Korean War prompted the US government to impose economic sanctions on the country. Declaring a national emergency on 16 December 1950, US President Truman promulgated the Foreign Assets Control Regulations, which sought to prevent communist regimes from gaining foreign reserves through economic exchange with the United States. In August 1951, an extension of the regulations mandated that ‘[a]rticles which are the growth, produce, or manufacture of China (except Formosa [Taiwan]) or North Korea shall be deemed … to be merchandise whose country of origin is China (except Formosa) or North Korea notwithstanding that they may have been [processed or produced] in another country’ (Federal Register 1951, 8108).

This US policy effectively barred the import into the United States of all products made with any Chinese raw material. While the regulations did not discriminate against any particular trading partner, the impact on Hong Kong was so severe that exports from the British colony came to a virtual standstill. As Hong Kong’s trade was intricately linked with mainland China, US restrictions disrupted the colony’s economy. Its trade with China had surged in 1950 and 1951 in anticipation of the embargo, only to languish for the rest of the decade (Meyer 2000, 147). In 1952, Hong Kong’s trade with the PRC registered a precipitous drop of 45 per cent (Peruzzi 2017, Table 1; Hong Kong Department of Commerce and Industry 1953, 5). From 1952 to 1958, soybean imports plummeted by 70 per cent, and exports all but vanished (Hong Kong Trade Returns, 1952, 1958). The colonial government had to work quickly with the United States to devise a scheme within the new framework to facilitate the export to the United States of bona fide Hong Kong products.

Place of origin had become increasingly important in the post-Second World War era as various regimes sought to protect their domestic industries and strove to deal with their fellow members of specific trade zones (Mills 2012, Chapter 3). In Hong Kong, the colonial regime had tasked the Department of Commerce and Industry with the issuance of Certificates of Hong Kong Origin. However, such certificates did not necessarily indicate the source of a product’s raw materials—a tricky issue for a city that imported most of the raw materials used in its products. As tensions with the PRC heightened, it thus became difficult to demonstrate to suspicious US officials that goods destined for the United States included no Chinese materials. For each product to be exported to the United States, its manufacturer needed to find a procedure agreeable to US authorities (Mills 2012, Chapters 3 and 5).

With the outbreak of the Korean War and the ensuing embargo on the PRC, the United States incorporated Hong Kong as an enforcement point in its economic agenda (Hamilton 2021, Chapter 1). Yet, it was tricky for the United States to formulate an arrangement specifically for Hong Kong, a city not only located in close proximity to the PRC but also connected to the ruling Chinese Communist Party through a web of economic entanglements. After ‘prolonged negotiations’ between ‘a senior official of the U.S. Treasury’ and the Hong Kong Department of Commerce and Industry, the parties agreed on ‘[a] special and complicated procedure involving the issue of Comprehensive Certificates of Origin’ that attested to the place of origin for both products and raw materials. Under this system, Hong Kong exports to the United States were to be ‘specially certified’ by this department of the British colonial government. The Hong Kong government published the Exportation (Certificate of Origin) Regulations in the Gazette on 9 January 1953. To satisfy the Comprehensive Certificate of Origin requirements, Hong Kong manufacturers shipping simultaneously to markets outside the United States had to segregate Chinese raw materials from those of other origin. Not only did manufacturers have to make their premises and business records open to periodic random inspections, they also had to furnish the Department of Commerce and Industry with monthly returns detailing ‘orders received, production, shipment, wastage, etc.’. Corruption was rampant in the colonial bureaucracy at the time and the system was not impregnable,⁵ even with the posting of a US Foreign Assets Control representative in the British colony. Yet, Hong Kong’s exports to the United States resumed nonetheless (Federal Register 1953a, 1140; Federal Register 1953b, 2080; Hong Kong Legislative Council 1956, 331; Hong Kong Department of Commerce and Industry 1953, 7; 1958a, 179–83; HKPRO HKRS163-1-2984; Mills 2012, Chapter 5).

The trade disruption dealt a heavy blow to the Hong Kong economy, which was struggling to recover from wartime damages. As the British colony strove to maintain economic viability, small manufacturing operations sprouted up (Cain 1995; Goodstadt 2007, 88). Soy sauce production was one such operation. The list of items covered by the Comprehensive Certificate of Origin regulations included just eight commodities in 1953. By March 1954, the list had expanded to include ‘Hoi Sin sauce’ and ‘Soy sauce’ (Federal Register 1954a, 386; Federal Register 1954b, 1188; Hong Kong Department of Commerce and Industry 1954, 10–12; 1958a, 179–83). The inclusion of soy sauce (and Hoi Sin sauce, which counts soybeans as one of its major ingredients) allowed Hong Kong to capitalize on its role in the soybean trade. Leveraging its soybean imports, Hong Kong built on its pre-war efforts to cultivate a budding soy sauce manufacturing industry that found an expanding export market, most notably in the United States. To earn certification for export to the United States, sauce makers bought a requisite amount of soybeans of non-mainland Chinese origin, and paid the corresponding stamp duty according to weight (interview with a Hong Kong soy sauce maker, Sheung Wan office, 15 October 2020).

The sourcing of soybeans proved erratic throughout the mid-1960s as the British colony sought alternative suppliers to supplement PRC imports (which could still be processed for soy sauce exports to markets other than the United States). Hong Kong importers found the United States to be a plausible second supplier of soybeans until 1971 but Chinese imports continued to dominate the market and commanded a share of between 60 and 90 per cent until the PRC’s reform era (Figure 2). The small share of non-PRC soybean imports notwithstanding, manufacturers in Hong Kong managed to convince the authorities of the acceptable origin of ingredients for soy sauce exports to the United States and secure the requisite Comprehensive Certificates of Origin.

Source: Hong Kong Trade Returns.

Figure 2. Hong Kong soybean imports, 1952–1980.

Certification of the absence of PRC ingredients did not go uncontested. The colonial government demonstrated caution about the possibility of forged Certificates of Origin (Hong Kong Legislative Council 1960, 239–40; 1963, 171; HKPRO HKRS47-1-112). It was an open secret that the policing mechanism was far from perfect, as producers continued to use mainland Chinese soybeans in the production of sauces bound for the US market (interview with a Hong Kong soy sauce maker). In 1967, Jimmy McGregor of Hong Kong’s Department of Commerce and Industry reported ‘serious breach of the agreed [Comprehensive Certificate of Origin] procedure’ and ‘prevalent’ malpractice in the export of foodstuff to the United States. Acknowledging the ‘widespread use of Chinese origin’ produce, his report noted nonetheless that ‘this malpractice is inevitable if exports to the U.S. are to be continued’ because it was impossible to guarantee sufficient supplies of the right quality and price from other places of origin. The report valued ‘soy and soy sauce’ accounted for 21 per cent of total foodstuff exports to the United States (HKPRO HKRS163-1-2984).⁶

Despite the initial challenges in the aftermath of the Korean War, trade arrangements with the United States paid off for Hong Kong. By 1958, the United States had risen to second place (behind the UK) in the purchase of Hong Kong manufactures of all kinds, buying HK$205 million worth of goods in that year, up from just HK$70 million in 1954. The number of Comprehensive Certificates also showed a marked increase, with total exports under the scheme expanding by 69.7 per cent in 1958 (Hong Kong Department of Commerce and Industry 1959, 3, 7, 46–47). In the same year, the colonial government featured in its Trade Bulletin an article on soy sauce, exports of which ‘came to nearly 4,000 tons’, for a total value exceeding HK$3.5 million in 1957. ‘[I]ndeed there are few countries in the world today which do not import soy sauce made in Hong Kong’, boasted the article (Hong Kong Department of Commerce and Industry 1958b, 328). Of those exports, the United States accounted for 24 per cent (Hong Kong Trade Returns 1957, 56–57), a percentage that would more than double in the next few decades.

Struggling to establish a foothold throughout the 1950s, annual exports of soy sauce from Hong Kong hovered around HK$3 to 4 million in that decade, with Malaya and the United States being the primary markets. As the United States grew to become the top buyer of Hong Kong soy sauce in 1960, the industry gained traction and registered consistent growth thereafter. Shipments to the United States expanded from 32 per cent of the industry’s total exports in 1960 to 42 per cent in 1970. Total volume doubled in the 1960s to reach HK$7.5 million in 1970 (Hong Kong Trade Returns, 1950–70) (Figure 3).

Source: Hong Kong Trade Returns.

Figure 3. Hong Kong trade in soy sauce to 1970.

Sauce maker Koon Chun played a critical role in the expansion of soy sauce exports from Hong Kong to the United States. The Chan family has run this Hong Kong soy sauce manufacturer since the 1930s, when Chan Yue bought into the business (Purchase and sale document, Koon Chun archives). His early business ventures had taken him from his native Canton to Panama, where officials noted that he spoke ‘a bit of Spanish and English’ (Chan Yue’s Pasaporte Numero 5, Panama, 29 April 1918, Koon Chun archives). Upon his arrival in Hong Kong, Chan acquired partial ownership of Koon Chun, a soy sauce operation in Kowloon City at the foot of Lion Rock. Not yet the densely populated urban area it later became, Kowloon City offered Koon Chun and other sauce makers ample land for the ‘sunning’ of fermenting soy sauce (Figure 4). Leaving the production side of the business to the original operators, Chan set up an office in Sheung Wan, a predominantly Chinese neighbourhood adjacent to Central, the business district on Hong Kong Island. The Sheung Wan office served not just as a sales office: the district was an exchange site for information pertaining to the trade of Chinese foodstuff. From its shop-cum-office in Sheung Wan, Koon Chun expanded its reach to the Americas, which grew to a sizeable enough portion of its export business to warrant a separate set of account books (interview with Koon Chun management, 24 September 2020; interview with a Hong Kong soy sauce maker).

Source: Koon Chun.

Figure 4. Sunning soy sauce in earthenware.

The guild of soy sauce makers tackled the expanding overseas market with a mutual understanding of geographic focus. While others strove to expand their markets in Australia and Europe, Koon Chun capitalized on Chan’s transpacific connections and focused on the US market. Consistently featured in trade journals underwritten by (and undergirding) Hong Kong’s transpacific trade (Figure 5), Koon Chun penetrated the US soy sauce market through its distributors targeting both the restaurant business and predominantly Asian American retail channels (interviews with Koon Chun management, 24 September 2020, 21 October 2020). Prominently marked on the wooden barrels carrying Koon Chun soy sauce to the United States in those early days was the label ‘MADE IN HONG KONG’ (Figure 6).

Source: Annual report, July 1951, Wah On Exporters & Importers Association.

Figure 5. Koon Chun advertisement in a Chinese trade journal.

Source: Author’s photograph.

Figure 6. Koon Chun barrel for shipment of soy sauce to the United States, marked ‘Made in Hong Kong’.

Rather than a sign of pride in local products, the ‘Made in Hong Kong’ label originated from the US embargo on goods produced in North Korea or mainland China, as well as on products including ingredients from those two locales. ‘Made in Hong Kong’ conveyed a message that was politically imperative in the Cold War era and economically crucial to Hong Kong producers, the message being that ‘Made in Hong Kong’ products were not made in the PRC. To trade on the capitalistic side of the bamboo curtain, Hong Kong needed to explicitly distance its exports from PRC products. Such an arrangement, manifested by the certification requirement and the ‘Made in Hong Kong’ label, reflected the geopolitical situation of Hong Kong at the time and the political exigencies that affected the survival of its struggling yet budding economy—an economy that relied on US patronage while remaining intricately tied to the PRC system.

The growth of the export trade swept the city both financially and physically. As the British colony experienced economic take-off, Koon Chun and other sauce makers had to vacate their old premises in Kowloon City to make way for the expanding footprint of Hong Kong’s international airport. After a stint in the new urban zone of Tsuen Wan, Koon Chun moved in 1967 to its current home in Yuen Long on the outskirts of Hong Kong (Figure 7). Ironically, the relocation to the periphery of the city coincided with the mounting financial prowess of Koon Chun and other soy sauce makers. In 1968, they bought their guild an office in the city. As they registered the new office—housed in a prime location at the intersection of Nathan and Jordan Roads in bustling Kowloon—the industry marked its rise from the making of a local product in the flat lands under Lion Rock to a flourishing export-heavy industry that deserved its own place in the city. Koon Chun’s management occupied positions of honour in the guild (HKPRO HKRS837-1-192).

Source: Koon Chun.

Figure 7. Koon Chun’s relocation to new facilities in Yuen Long.

Soy sauce exports from Hong Kong continued to grow. From a respectable base in 1970, they expanded more than threefold to total HK$27.4 million in 1980. This expansion translates into a compound annual growth rate in excess of 12 per cent, albeit shy of the 17 per cent recorded by Hong Kong exports as a whole. The following ten years witnessed another threefold increase in soy sauce exports, or a compound annual growth rate of 10 per cent as compared to 11 per cent for Hong Kong exports as a whole. Fuelling this growth was the expansion of the US market, whose share of total Hong Kong soy sauce exports hovered around two-thirds in the 1990s (Hong Kong Trade Returns 1970–2000; Hong Kong Census and Statistics Department 1981, 77; 1991, 95) (Figure 8).

Source: Hong Kong Trade Returns.

Figure 8. Hong Kong trade in soy sauce since 1971.

This was a boom period for Hong Kong, its soy sauce industry and the US-focused Koon Chun. Hong Kong producers had turned what had begun as an effort to circumvent US trade restrictions into a business opportunity to create an international product chain. Since the early days of this period of tense Sino-US relations, Hong Kong had played a pivotal role and export-oriented soy sauce makers in the city profited from this round of geopolitical shifts.

Turning geopolitical tide invigorates a taste for Hong Kong

In 1971, the United States lifted its embargo (HKPRO HKRS270-5-108; New York Times 1971), and the requirements on Hong Kong production and certification of the origin of product ingredients ceased to be a business issue. At the same time, attracted by the lower cost of labour in the PRC, Hong Kong businesses began a ‘northward shift’ in the 1970s and 1980s, relocating their facilities to the Pearl River Delta area of mainland China (Sit 1998, 895–904). Certain sauce makers joined the move. Lee Kum Kee, a Hong Kong oyster sauce maker that was expanding into the soy sauce business, established production facilities in multiple locations in Guangdong province in the 1990s (Lee Kum Kee, n.d.).

From a business opportunity presented by a geopolitical exigency, ‘Made in Hong Kong’ lost its currency with the détente of the 1970s. Conversely, the reform era in mainland China presented the lure of cheaper land and labour, both factors important to the land- and labour-intensive production of soy sauce. As a giant among soy sauce makers, Amoy monetized its land holdings in Hong Kong with the sale of its 222,560-square-foot production site in Kowloon Bay for HK$200 million in 1977 (South China Morning Post 1977), but Koon Chun’s relatively remote location shielded it from the lure of the real estate boom.

Even as some businesses moved their production facilities to the mainland, Koon Chun remained steadfastly rooted in Hong Kong. Since 2000, soy sauce exports to the United States from Hong Kong have fluctuated. Overcoming some initial difficulties, Koon Chun saw revitalized US export growth by 2010, especially after the company won the account of a major US restaurant chain serving Asian fare. Throughout the company’s history, overseas sales have accounted for the overwhelming majority of its business, with the United States representing the lion’s share. In recent years, every month Koon Chun has shipped to the United States 30 to 40 containers packed with its sauces, which are produced entirely in Hong Kong (interviews with Koon Chun management, 24 September 2020, 21 October 2020, 13 January 2021).

Although the thawing of the Cold War rendered the ‘Made in Hong Kong’ label a historical relic, the recent round of Sino-US conflict has reactivated it. In July 2020, the Trump administration ordered that imported goods produced in Hong Kong no longer be labelled ‘Made in Hong Kong’. According to the Tariff Act of 1930, imports into the United States should be marked ‘legibly, indelibly, and permanently’ to indicate their ‘country of origin’ (19 U.S.C. 1304). In 1997, the US Customs Service directed that goods produced in Hong Kong should indicate Hong Kong as their origin even after the city’s reversion to China (Federal Register 1997, 30927–30928). On 14 July 2020, noting that Hong Kong was ‘no longer sufficiently autonomous to justify differential treatment in relation to the People’s Republic of China’, the Trump administration suspended application of certain elements of the US-Hong Kong Policy Act. Among the suspended elements was the provision for the ‘Made in Hong Kong’ label. The administration directed that after a transition period, imports from Hong Kong ‘be marked to indicate that their origin is “China”’ (Federal Register 2020a, 43413; Federal Register 2020b, 48551–48552).

Although the new directive’s impact did not extend to the application of the punitive tariffs that the United States has imposed on mainland Chinese goods, the removal of the ‘Made in Hong Kong’ label on shipments to the United States has had tremendous repercussions. In the United States, Koon Chun’s wholesale and restaurant customers will likely still recognize the Hong Kong origin of its products and adhere to their longstanding preference for them. The new ‘Made in China’ label might, however, give prospective customers pause, as different places of origin carry different connotations of food safety and other issues (interview with Koon Chun management, 21 October 2020; South China Morning Post 2020). While the impact on the US retail market remains to be seen, the new labelling requirement has generated immense publicity in Hong Kong.

Social unrest in Hong Kong, which began in earnest during the Umbrella Movement in 2014 and intensified with the 2019 Anti-ELAB campaign (Lee et al. 2019; Ma and Cheng 2019; Ng and Wong 2017), aggravated the city’s tense relations with mainland China. In this environment of rising local sentiment and heightened mainland-Hong Kong tension, local products appear to have galvanized a yearning for nativistic assertions. A US initiative directed at the PRC—the decree issued by the Trump administration to extend equal treatment to the labelling of Hong Kong and Chinese products—provided a currency boost to the once passé, and now masked, ‘Made in Hong Kong’ label, at least in its home base. Global geopolitics ignited enthusiasm in Hong Kong for both local products and its place-of-origin label, which had hitherto enjoyed no local appeal.

Hong Kong’s public broadcasting station RTHK carried an article on 24 August 2020 under the headline ‘Made-in-Hong-Kong becomes Made-in-China/Unable to show others our true colours, says local sauce maker’ (RTHK 2020). The article conveys the feelings of helplessness of Daniel Chan, the fourth-generation operator of the nine decades-old Koon Chun brand. ‘To mask the words “Made in Hong Kong” … means [that we are] no longer able to display our genuine looks’, lamented the great-grandson of founder Chan Yue (RTHK 2020). The city’s major English-language newspaper reported on how Koon Chun, along with other US export-oriented producers, has sought to ameliorate the impact of the new rule as workers at its sauce factory tape ‘Made in China’ labels over the old ‘Made in Hong Kong’ logo (‘Proud to be “Made in Hong Kong”’ 2020) (Figure 9).

Source: Author’s photographs.

Figures 9 a and b. The original ‘Made in Hong Kong’ label stamped on a Koon Chun product (a) is masked with a printed ‘Made in China’ label (b).

The anti-establishment local Chinese-language newspaper Apple Daily published multiple articles decrying the disappearance of the ‘Made in Hong Kong’ label in the United States while applauding Koon Chun’s insistence on upholding the tradition of making natural soy sauce through sunning in the open air of Hong Kong (Next Digital 2020; Apple Daily 2020). Initium Media, a local Chinese media outlet, situated the labelling development in the context of the demise of local manufacturing in Hong Kong, which has plummeted to just 1 per cent of the city’s GDP. In an interview, Koon Chun’s Daniel Chan asserted that with the company’s operations remaining in Hong Kong, it would strive to cultivate a local market (Initium Media 2020). Accordingly, in November 2020 Koon Chun adapted a print advertisement from 1951 (Figure 5), adding references to its long history in the export trade along with contemporary paraphernalia, to advertise its products locally: ‘Specializing for over ninety years in the export to European and American ports’ of various types of sauces (additions in the 2020 advertisements in italics) (Figure 10). Its claim of fame ‘near and far’ may have been an exaggeration in 1951, when local consumption of Koon Chun sauces was negligible, but without doubt the self-fulfilling assertion bore fruit in 2020. The company’s publicity and marketing efforts have boosted the sales of Koon Chun products in both high-end supermarkets and online channels in Hong Kong (interview with Koon Chun management, 13 January 2021).

Source: Koon Chun.

Figure 10. Koon Chun advertisement placed in a Hong Kong newspaper in November 2020.

Nativistic inclinations in Hong Kong found expression in the creation of what came to be known as the ‘yellow economic zone’. Yellow being the colour of the anti-establishment protests in Hong Kong in recent years, proponents of the yellow zone purport to support sympathetic businesses and create employment opportunities for those opposed to the governing regime. A survey in early 2020 indicated that over 90 per cent of those who marched in a New Year’s rally supported this commercial tactic of the protest movement (Ming Pao 2020a, 2020b). Putting into practice ‘political consumerism’, supporters of the movement boycott pro-government businesses (‘blue’ businesses) and ‘buycott’ businesses whose values align with their own (Lee 2020; Poon 2020; Prasso 2020). The tactic inflicted sufficient pain on those aligned with the governing regime for a pro-Beijing newspaper to condemn it for being likely, according to the reporter, ‘only [to] hasten the demise of Hong Kong’ (Wen Wei Po 2019). A pro-Beijing group followed up with a report rebuking the protest movement for allowing its political stance to override free market economic principles (Dong 2020). As the yellow economic campaign gathered momentum, protestors called for the support of food-related businesses in a bid to unseat the pro-establishment representatives of the food industry in the 2020 Legislative Council election, which the authorities subsequently delayed (Ng 2020).

Why was it necessary to cultivate a taste for ‘Made in Hong Kong’ soy sauce? Food products have proved to be a fertile site for the expression of local consumerism, taste and a bodily defence against unwanted outside elements. Soy sauce has indeed played an important role in defining tastes in Hong Kong, not only for Chinese fare but also for fusion cuisine (for example, ‘soy sauce western’ cuisine [Sterling and Chong 2001, 149; Ho 2010, 49–50]). Yet, trade figures indicate that Hongkongers’ taste for soy sauce is rooted in mounting imports of the flavour enhancer from mainland China. Just as Hong Kong was expanding its exports of soy sauce, its imports of the product produced elsewhere skyrocketed. Until the mid-1980s, soy sauce produced in the PRC represented the vast majority of Hong Kong’s soy sauce imports by volume (Figure 11). In other words, Hongkongers came to accept the ‘mainland’ taste of soy sauce just as Koon Chun and other Hong Kong sauce makers were exporting increasing volumes of their products to overseas markets. In the present moment of heightened cultural and political anxiety, however, local sauce makers’ promotion of their Hong Kong products resonates with Hongkongers’ desire to preserve their ‘local’ taste, even if it is one only recently discovered among the city’s homegrown export merchandise.

Source: Hong Kong Trade Returns.

Figure 11. Hong Kong imports and exports of soy sauce, with the PRC’s representation of total imports.

Set against the rise of nativist sentiment in Hong Kong, the erasure of the ‘Made in Hong Kong’ label on US shipments has become a battle cry for the consumption of locally produced consumables.⁷ Capitalizing on this dramatic turn of events, businesses are accentuating their local production to appeal to Hong Kong consumers.

The inclination to consume local products entails an imagined tradition. To contrast their own sauces with mass-produced soy sauce, especially those from mainland China, where some makers rely on ‘modern’ scientific techniques of chemical fermentation, Koon Chun and other local Hong Kong sauce makers tout their insistence on traditional fermentation, sunning, and mixing techniques passed down through the generations. The resulting products actually contain no local ‘ingredients’ other than Hong Kong labour and more expensive natural exposure to the sun (the sunning process requires that vats or urns of fermenting sauces occupy precious square footage for months at a time). The artisanal production of soy sauce depends on treasured family recipes and long-serving skilled workers. Although these factors may be portable to other locations, the claim of being ‘homegrown’ demands that the makers remain domiciled in Hong Kong. For an industry that relies on direct exposure to the sun during the months-long sunning process, this is an expensive proposition in Hong Kong. Financially responsible operators cannot ignore the skyrocketing real estate value that comes with the urban sprawl, especially when the mainland offers lower-cost alternatives. As a result of the land-intensive nature of sauce making, the ‘Made in Hong Kong’ label has become an exorbitant proposition.

Corporate ownership of its production site, as well as the thriving US export market, continued to underwrite Koon Chun’s production in Hong Kong and sustain its ‘Made in Hong Kong’ label. Displaced from its city location in Kowloon in the 1960s to the less-prized footprint in Yuen Long, Koon Chun did not have to consider the sale of its land holdings as other soy sauce makers placed financial priorities over place-of-origin propositions. The sauce maker’s extended footprint in Yuen Long provided ample capacity to deal with swelling demand but the earthenware urns it used could hardly contain the rising throughput. In the 1980s, as Koon Chun insisted on sunning its soy sauce at its Hong Kong location, management decided to forgo the clunky setup and opted for cement vats for larger production scale (interviews with Koon Chun management, 24 September 2020, 21 October 2020).

Without using any native ingredients, Hong Kong’s sauce makers produce a taste of home through the terroir of the city’s land (McIntyre 2019). Yet, underpinning this notion of terroir is not the usual organic infusion of taste but rather the sauce makers’ insistence on local production. Hong Kong-produced soy sauce could carry a taste of home because of ecological factors such as climate, soil, and water supplies. If these physical factors were to be responsible for the appeal of local soy sauces among Hongkongers, theirs would be a newly acquired taste. Long conditioned to the consumption of mainland alternatives, Hong Kong consumers are feeding their nativistic yearnings by supporting homegrown soy sauces. For soy sauce, they have not insisted on time-honoured culinary preferences but instead developed a consumption pattern that resonates with their political anxiety. For a city known for commercial pragmatism, land-intensive soy sauce production in a real estate-driven economy is an expensive proposition, as indicated by the rhetorical question one sauce maker asked another: ‘What if they offered you billions of dollar for the land your factory sits on?’ (interview with a Hong Kong soy sauce maker). The economic dilemma of sauce makers in Hong Kong is an apt parallel to the perceived plight of politically agitated Hong Kong consumers who are feeling increasingly displaced from their hometown. Local consumption of ‘Made in Hong Kong’ products signals their defiance and defence of their home turf. Alongside climate, soil, and water supplies, land ranks among the environmental constraints that condition the materiality of foodstuff and its consumption. In the case of soy sauce making in Hong Kong, ‘land’ or terroir takes on the added meaning of the (un)affordability of real estate. Food choices are predicated on culture. The cultural shift stemming from Hongkongers’ growing feelings of insecurity at home has precipitated the recent rise in the local consumption of ‘Made in Hong Kong’ soy sauce. Once again, the ‘Made in Hong Kong’ label has gained currency as geopolitical turmoil engulfs the city.

Conclusion

The global circulation of foodstuffs has the potential to transform international dynamics. Conversely, geopolitical conflicts can also alter foodways. Soy has long held sway over global developments (Du Bois 2018), especially in the imagination of modernity in China (Fu 2018). While such developments generated the trade of soybeans through Hong Kong in the early twentieth century, the seismic shifts of the Cold War era wreaked havoc on that trade in the 1950s and redirected the Hong Kong economy towards value-adding efforts to process soybeans into soy sauce for overseas markets.

Originating not as a response to consumer tastes, soy sauce exports from Hong Kong to the United States were aimed at circumventing US trade restrictions. In the process, Hong Kong sauce makers charted a new course of economic exchange and created an international product chain. In the Cold War era, Hong Kong products did not convey ‘the liability of foreignness’ (Bucheli and Salvaj 2017) in the US trade, whereas those of mainland Chinese origin did. Provisions in US trade regulations afforded Hong Kong businesses a mechanism by which to work around the embargo on PRC products. Accordingly, export-oriented sauce makers in Hong Kong prominently displayed the ‘Made in Hong Kong’ label to distance their products from a political power deemed unacceptable by a major prospective buyer. They legitimated their products through ‘geopolitical jockeying’ (Lubinski and Wadhwani 2019) as they portrayed their business strategy as complementary to US interests. Unlike other indications of geographic origins (Higgins 2018), the ‘Made in Hong Kong’ label necessitated by the US embargo on mainland Chinese products did not confer a sense of product inferiority or superiority. Instead, the label piloted Hong Kong sauces and other products through the tumultuous international marketplace. The place-of-origin label on merchandise exported to the United States reflected neither the special appeal of Hong Kong products in the United States nor local pride in Hong Kong merchandise in its place of origin.

Corporate nationality is a construct in cross-border transactions (Gehlen et al. 2020). In response to trade regulations, Hong Kong exporters ‘cloaked’ (Jones and Lubinski 2012) their imports of soybeans, a commodity sourced primarily from mainland China.⁸ By procuring the requisite volume of American (or, more precisely, non-mainland Chinese) soybeans, Hong Kong sauce makers began shipping mounting volumes of soy sauce, a processed product, to the US market. As the Hong Kong economy strove to gain a foothold in the world of trade against the backdrop of shifting geopolitics, enterprising operators leveraged a provision in US trade regulations to fashion an international business opportunity out of the cottage industry of sauce making in their city. They fashioned an international product chain and forged an export market for Hong Kong soy sauce in the United States.

Soy sauce makers in Hong Kong fared well in the intervening decades, seismic shifts in the geopolitics of global trade notwithstanding. For Hong Kong soy sauce makers, recent Sino-US trade disputes have imposed a new round of challenges, while at the same time providing a potential entrée to the hitherto under-explored local retail market in the very city where their sauces are produced. Enterprising soy sauce makers began their geopolitical jockeying again in 2020, this time to cultivate and promote a taste for a homegrown food product among Hong Kong consumers.

The retail market in Hong Kong has long since passed the first phase of consumerism, which scholars trace to the age of industrialization (McKendrick et al. 1982). In their well-developed consumer market, Hongkongers find expressions of their identity in their consumption patterns, not unlike their counterparts in other areas of the world (Nelson 2000; Scarpellini 2008; Usui 2014). Their strategy echoes Chinese consumer preferences for local products over items deemed foreign in the early twentieth century in a process that contributed to the fashioning of the modern Chinese nation (Gerth 2003). In the face of recent political and cultural challenges, twenty-first-century Hong Kong consumers are articulating their local identity through their purchases of homegrown merchandise. Those who consider themselves politically disenfranchised in Hong Kong initiated this campaign to express their self-identity through consumption (McDonald and Wearing 2013). Well-versed in formulating a local flavour in the midst of global culinary currents (Watson 1997; Wu and Tan 2001; Wu and Cheung 2002), Hong Kong consumers have once again found food to be a productive platform on which to assert their position. Working in concert with this phenomenon, Hong Kong soy sauce makers have crafted marketing strategies to extend their reach to local retail customers.

Both the US embargo that required certification of Hong Kong origin for exports to the United States and Trump’s executive order mandating the removal of the ‘Made in Hong Kong’ label ushered in changes to the business environment in Hong Kong. Both of these episodes, which infused value into the ‘Made in Hong Kong’ label, emanated from US political manoeuvres in the Asia-Pacific region, and both also involved a definition of Hong Kong vis-à-vis the PRC. The earlier episode required Hong Kong producers to distance their businesses from commercial interests in the PRC, whereas the recent episode resulted from the Trump administration’s assessment that Hong Kong was no longer distinct from the PRC.

In the earlier episode, the place-of-origin label designating Hong Kong production did not inspire preference for or against local consumption—it was an essential step to disavow mainland Chinese connections for the pursuit of business opportunities in the United States. In the recent episode, US policies triggered a realignment that did not hurt sales overseas but conspired with growing anti-mainland sentiments and created local commercial opportunities. In both cases, concurring with the United States’ anti-mainland stance furthered business interests. However, in the earlier case, adherence (or the pretence thereof) to the US trade mandate that sought to isolate communist China economically was merely commercially expedient. In contrast, recent US restrictions might not have affected overseas business profits significantly but American anti-mainland Chinese rhetoric found resonance among local consumers in Hong Kong. Businesses turned their attention to the local retail market and appealed to consumers in the troubled city. While geopolitics may render the notion of being ‘Chinese’ (or not) problematic in certain eras (Chung 2005; Mathews and Lui 2001), business pragmatism can transform such geopolitical ‘moments’ into commercial opportunities in tune with the prevailing mentality.

Shifting US/China relations disrupted trading networks and translated into operating risk as well as business opportunities, at least with respect to the Hong Kong soy sauce market. Political calculations and commercial manoeuvres met, encapsulating, in the ‘Made in Hong Kong’ label, Hong Kong’s changing place in global geopolitics and the city’s position vis-à-vis the PRC.