Political strategist Lynton Crosby says Hong Kong government must deal with issues head on to resolve crisis

• Lynton Crosby, the election campaign strategist behind the Conservative Party’s 2015 election win, says the Hong Kong government must deal with the causes of the protest and come up with a plan to address the problem
• Crosby’s CT Group, which opened its Hong Kong office in June, says the company has been approached by multinational corporations on how to deal with the crisis in the city

Hong Kong's government, grappling with the city's worst political crisis, must address the causes that drove residents by the tens of thousands " even up to 2 million on June 17 " to march in street protests for four straight months, said one of the world's most influential conservative political strategists.

That approach would give all stakeholders the confidence that issues " such as housing affordability, job prospects and income inequality " can be addressed, said Lynton Crosby, who steered the Conservative Party to win the London mayoral office in 2008 and 2012, and successfully ran the UK's 2015 general election.

Focusing "simply on the act of the protest rather than the cause of them, (makes) it harder to deal with," Crosby said in an interview with the South China Morning Post in Hong Kong, where his firm CT Group had been operating its first Asia office since June. "What you have to do is break it down into the different parts, and deal with those."

"I'm not going to comment directly on the government, but my experience when you have a crisis is you cannot leave a vacuum. The first thing you have to do is keep people informed and have a strategy to deal with the challenge you face," he said.

"It's obviously not an easy thing but if there is a problem, always acknowledge it, and then give people the confidence that you have a plan to deal with it."

Hong Kong's Chief Executive Carrie Lam Cheng Yuet-ngor, who unleashed the city's biggest civil disobedience in history with her attempt to push through a controversial extradition bill, is now trying to restore order in one of the world's biggest fundraising hubs. Even though Lam withdrew her unpopular bill, persistent protest rallies had deteriorated into street mayhem and violence, deterring visitors from the city and causing retail sales to plummet.

Hong Kong's economy shrank in the fiscal second quarter, and is on track to enter a technical recession in the three months ending in December, as the city has been squeezed by a combination of the year-long US-China trade war and street protests. Lam failed on Wednesday to deliver her much-anticipated policy address, as opposition members of the city's legislature heckled and disrupted her speech.

Lam, a career bureaucrat who rose to the city's top job, had been criticised for turning a blind eye to public sentiment and for failing to listen to feedback.

"In any crisis, if you hunker down, close your eyes and hope (for the problem) to go away, that is not a good response. What you must do is tell the story," said Crosby, nicknamed the "Wizard of Oz", whose company has had multinational corporations ask for advice on how to deal with any impact of Hong Kong's civic disobedience.

"I think the government has tried," said the Australian strategist, adding that Lam's administration did not approach CT Group for advice. "There is mention that (the government) had reached out to a number of public relations firms to try and help communicate the issue, but it's not a PR issue, it is something more complex than that."

Similarly, businesses in Hong Kong, and the region, need to better understand their key stakeholders, which CT Group has found to be a key problem.

In any crisis, if you hunker down, close your eyes and hope (for the problem) to go away, that is not a good responseLynton Crosby

"Often companies don't really know what their shareholders, investors, customers are thinking. They have assumptions about it," said Crosby. "We have found a lot of interest in companies wanting to better understand not just what a stakeholder may think, but why they hold the view and how they deal with it."

"I think there is a cultural difference, and sometimes a reluctance to go deep in finding out what really drives somebody, which is what we try and do," he said. CT Group uses research-driven campaigns for corporate and political clients.

The need to more deeply understand the market applies to companies dealing with the current unrest in Hong Kong.

"The response is to go deeper than what you are seeing on the TV, look at where your markets are," said Crosby. "Sit down and properly chart a course to see if it really does impact."

But despite the short term economic headwinds Hong Kong faces, the city "is an incredibly resilient place", said Andrew Whitford, managing director for C|T East Asia. He noted how it overcame past issues like Severe acute respiratory syndrome (Sars) in 2003: a form of pneumonia that killed 299, slammed tourism levels and hit consumption.

"We are confident that Hong Kong will bounce back," said Whitford.

Meanwhile, its role in the Greater Bay Area " the grouping of 11 cities into an economic and business hub " demonstrates its importance as a financial centre. "We take comfort and guidance from that, that Hong Kong's role is well and truly well documented," he said.

The worry could be that the more the unrest continues, the more they will undermine some of the issues the public want solved like lack of job opportunity and cost of living, causing more uncertainty, argued Crosby, drawing a comparison to Brexit.

Though his company did not run either the UK's Remain or Leave campaigns in 2016, it conducted polling during the referendum, and Crosby himself has previously advised UK Prime Minister Boris Johnson.

Similarly, he said, the UK parliament's passing of a legislation in September to stop a no-deal Brexit undermined Johnson's negotiating power and continued to delay Britain's leaving of the EU, despite polls saying more than half of Britain want the 2016 referendum respected.

The Brexit uncertainty continued on the weekend after Johnson lost a crunch vote in parliament to leave the EU. Johnson sent a request, without his signature, to the EU to delay the Brexit. In another letter, which he signed, he said he believed a delay would be a mistake.

"The real risk is you end up with people unhappy that a deal hasn't been reached and things have been deferred … and the uncertainty continues," said Crosby.

"A majority of people in the UK now just want the issue dealt with, done and dusted, they are sick of it," he said.

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