Hong Kong protesters defy Beijing with calls for democracy

(Reuters) - Hong Kong democracy protesters defied volleys of tear gas and police baton charges to stand firm in the centre of the global financial hub on Monday, one of the biggest political challenges for Beijing since the Tiananmen Square crackdown 25 years ago.

China wagged its finger at the student protesters, and warned against any foreign interference as they massed again in business and tourist districts of the city in the late afternoon.

"Hong Kong is China's Hong Kong," Foreign Ministry spokeswoman Hua Chunying defiantly told a news briefing in Beijing.

The unrest, the worst in Hong Kong since China resumed its rule over the former British colony in 1997, sent white clouds of gas wafting among some of the world's most valuable office towers and shopping malls before riot police suddenly withdrew around lunchtime on Monday, after three nights of confrontation.

China rules Hong Kong under a "one country, two systems" formula that accords the territory limited democracy. Tens of thousands of mostly student protesters are demanding Beijing give them full democracy, with the freedom to nominate election candidates, but China recently announced that it would not go that far.

As riot police withdrew on Monday, weary protesters slept beside roads or sheltered from the sun beneath umbrellas, which have become a symbol of what some are calling the "Umbrella Revolution". In addition to protection from the elements, umbrellas have been used as flimsy shields against pepper spray.

Nicola Cheung, an 18-year-old student from Baptist University, said the protesters in central Admiralty district were assessing the situation and planning what to do next.

"Yes, it's going to get violent again because the Hong Kong government isn't going to stand for us occupying this area," she said. "We are fighting for our core values of democracy and freedom, and that is not something violence can scare us away from."

Organisers have said that as many as 80,000 people have thronged the streets after the protests flared on Friday night. No independent estimate of numbers was available.

The protests, with no single identifiable leader, bring together a mass movement of mostly tech-savvy students who have grown up with freedoms not enjoyed in mainland China. The movement represents one of the biggest threats for Beijing's Communist Party leadership since its bloody 1989 crackdown on pro-democracy student protests in and around Tiananmen Square.

Cracking down too hard could shake confidence in market-driven Hong Kong, while not reacting firmly enough could embolden dissidents on the mainland.

The protests are expected to escalate on Oct. 1, China's National Day holiday, with residents of the nearby former Portuguese enclave of Macau planning a rally. Pro-democracy supporters from other countries are also expected to protest, causing Beijing further embarrassment.

Such dissent would never be tolerated on the mainland, where the phrase "Occupy Central" was blocked on Sunday on Weibo, China's version of Twitter. The protests have received little coverage on the mainland, save for government condemnation.

Televised scenes of the chaos in Hong Kong over the weekend have already made a deep impression on many viewers outside Hong Kong. That was especially the case in Taiwan, which has full democracy but is considered by China as a renegade province that must one day be reunited with the Communist-run mainland.

"Taiwan people are watching this closely," Taiwanese President Ma Ying-jeou said in an interview with Al Jazeera.

Britain said it was concerned about the situation in Hong Kong and called for the right of protest to be protected.

The U.S. Consulate General in Hong Kong issued a statement calling for all sides to "refrain from actions that would further escalate tensions".

China's Hua said Beijing noted statements expressed by countries such as the United States. "We hope that the relevant country will be cautious on this issue and not send the wrong signal," she said.

"We are resolutely opposed to any foreign country using any method to interfere in China's internal affairs. We are also resolutely opposed to any country, attempting in any way to support such illegal activities like 'Occupy Central'."

"We are fully confident in the long-term prosperity and stability of Hong Kong, because I believe this is in keeping with the interests of all the people in China, the region and the world," she said.

In 1989, Beijing's Tiananmen crackdown sent shockwaves through Hong Kong as people saw how far China's rulers would go to keep their grip on power.

SOME BANKS PULL DOWN SHUTTERS

Banks in Hong Kong, including HSBC (HSBA.L), Citigroup (C.N), Bank of China (601988.SS), Standard Chartered (STAN.L) and DBS (DBSM.SI), shut some branches and advised staff to work from home or go to secondary branches.

The Hong Kong Monetary Authority, the city's de facto central bank, said the city's interbank markets and Currency Board mechanism, which maintains the exchange rate, were not affected by the unrest. It said it stood ready to "inject liquidity into the banking system as and when necessary".

Hong Kong witnessed extraordinary scenes at the weekend as thousands of protesters, some armed with nothing more than umbrellas, blocked the main road into the city and police responded with pepper spray, tear gas and baton charges.

Markets more or less took the weekend's unrest in their stride, proof yet again of the pre-eminent place trade has always taken in Hong Kong. Hong Kong shares .HSI ended down 1.9 percent.

The protests have spooked tourists, with arrivals from China down sharply ahead of this week's National Day holidays. Hong Kong on Monday cancelled the city's fireworks display over the harbour, meant to mark the holiday. The United States, Australia and Singapore issued travel alerts.

SCUFFLES BREAK OUT

Some protesters erected barricades to block security forces early on Monday, although a relative calm descended after dawn. By mid-afternoon, hundreds of protesters were seen streaming again into downtown areas of Hong Kong island. A bus draped with a banner reading "Democracy" was parked across a main road.

People placed discarded umbrellas over students sleeping in the sun, while others distributed water and masks to guard against tear gas and pepper spray.

Hours earlier, police had baton-charged a crowd blocking a road into the main government district in defiance of official warnings that the demonstrations were illegal.

Protesters called on Hong Kong leader Leung Chun-ying to step down. Several scuffles broke out between police in helmets, gas masks and riot gear, and demonstrators.

"If today I don't stand up, I will hate myself in future," said taxi driver Edward Yeung, 55, as he swore at police. "Even if I get a criminal record it will be a glorious one."

Across Hong Kong's famed Victoria Harbour, smaller numbers of protesters, including some secondary school students, also gathered in the Mong Kok district of Kowloon.

About 200 workers at Swire Beverage, a unit of Hong Kong conglomerate Swire Pacific (0019.HK) and a major bottler for the Coca-Cola Company (KO.N), went on strike in support of the protesters, a union representative said. They also demanded the city's leader step down.

The "one country, two systems" formula guarantees Hong Kong a high degree of autonomy and freedoms not enjoyed in mainland China, with universal suffrage set as an eventual goal.

However, Beijing last month rejected demands for people to freely choose the city's next leader, prompting threats from activists to shut down the Central business district.

China wants to limit 2017 elections to a handful of candidates loyal to Beijing. Communist Party leaders worry that calls for democracy could spread to the mainland.