For almost five months now, Hong Kong has been witnessing weekly demonstrations and clashes with the police. Spurred by an attempt by the local government to push through a bill that would have allowed extradition to mainland China, the protests have now grown into a much larger show of public anger, which the withdrawal of the proposed legislation could not pacify.

The people of Hong Kong are now protesting against what they see as a systematic campaign to undermine their way of life, which the 1984 treaty between China and the former colonial power, Britain, guaranteed would be preserved for 50 years from the handover date of July 1, 1997.

The strength of feeling among the demonstrators has surprised those who assume that Hong Kong’s population is apolitical and purely concerned about business. The truth is, over the past century, the city has been at the centre of some of the most potent political movements in Chinese history.

In 1925, Hong Kong’s workers went on a strike as part of the May Thirtieth protests against the power of British imperialism after the British colonial police opened fire on Chinese protesters in Shanghai. In 1967, emboldened by neighbouring Macau’s successful anti-colonial struggle against the Portuguese and inspired by Mao Zedong’s Cultural Revolution, leftist groups took advantage of a labour dispute and organised mass protests against the British.

In 1989, 1.5 million are said to have marched in solidarity with protesters on Tiananmen Square in Beijing. In 2003, draft legislation on “subversion” proposed by the Hong Kong government under Article 23 of its Basic Law raised concerns among residents that their basic freedoms were being threatened, which triggered mass protests. In 2014, changes in the city’s electoral law, which gave Beijing greater political oversight, triggered popular demonstrations which converged into the so-called Umbrella Movement.

However, this latest wave of protests does seem distinctive from previous instances of popular unrest. There is an existential tone to it, fuelled by the idea that if Hong Kong’s guarantees of freedom are legislated away, then they will be lost forever.

There is also a strong sense of frustration at the timidity of Hong Kong’s government. The city’s leaders have had the chance to come out and speak boldly about how they see themselves mediating between the Beijing authorities and the Hong Kong population. So far, government statements have swung between well-meaning declarations light on substance and condemnations of the small minority of violent protesters, ignoring the non-violent majority.

Meanwhile, there are signs that China’s government is looking for a way to get around the Hong Kong issue, rather than confront it head-on. Despite its threatening language and the amassing of military trucks and troops on the border between Hong Kong and Shenzhen city, the likelihood of Chinese military intervention is extremely small.

The fallout from the violent suppression of the 1989 Tiananmen uprising damaged China’s international reputation for decades; the topic still cannot be discussed openly in China – an indication of how toxic the issue still is. Beijing will do everything it can to avoid a repeat of this major confrontation.

Instead, the central government is making new medium-term plans. Hong Kong’s neighbouring city of Shenzhen is at the centre of a new strategy to promote “socialism with Chinese characteristics”. This phrase has been in use since the reforms helmed by former Chinese leader Deng Xiaoping in the 1970s, and it has allowed the redefinition of “socialism” in directions that would have had Chairman Mao turning in his mausoleum, in particular, the state-sponsored turbo-capitalism that dominates the People’s Republic today.

In the past few weeks, China’s authorities have been using the phrase to describe their ambitious economic plans for Shenzhen, the Greater Bay Area and Hong Kong, which include encouraging mainland firms to set up operations there and building infrastructure to boost scientific research.

It has been reported that those working in the area may be granted special – that is, preferential – residency rights, and that it would be made easier for Hong Kong residents to relocate within the Greater Bay Area.

In other words, this is a plan to win over the people of Hong Kong through economic prosperity by creating a new form of separate identity within China that tries to redefine the current division between Hong Kong and the rest of the country. It would be a more flexible form of identity in which residence of the Greater Bay Area provides more social and economic rights to southerners than in other parts of China.

For this plan to work, however, Beijing needs to recognise that engagement with Hong Kong has to happen on two levels: economic and political. The inability of young residents of Hong Kong to find decent jobs and affordable housing has been a powerful driver of the protests. But Hong Kong has never been just about economics. Its government’s argument that once the city becomes more integrated into southern China, it will forget about its concern with liberal values is flawed.

These values are precisely what makes so many Hong Kong residents so proud of their city. Its free media, independent legal system and academic freedoms are still very distinctive, not just in comparison with the rest of China but with many other societies in Asia. Simply dismissing those values as irrelevant or outdated won’t change hearts and minds. Nor will attempts at “patriotic education” that suggest a top-down, monolithic idea of national identity; such initiatives have actually led locals to feel less, not more, Chinese.

That is why Beijing has to positively engage with Hong Kong politically as well. The boldest move would be for the authorities actually to agree with the protesters about one key thing: that their liberal values are central, not marginal, to what makes Hong Kong distinctive, and also, more daringly, what makes it Chinese.

After all, Hong Kong’s great universities may have been originally set up by foreigners, but it took Chinese professors, administrators and students to make them what they are today. Hong Kong’s legal system would have collapsed without the service and dedication of Chinese lawyers, judges and police officers. Its lively Chinese-language press and publishing world was certainly not set up for the benefit of westerners, few of whom read Chinese.

There is a powerful case for a new patriotic education that embraces what makes Hong Kong unique: that it cherishes freedom of expression and legal independence, that it does so as part of its Chinese identity, not despite it, and it can comfortably exist alongside a mainland China that has taken a different route.

China has always been a plural concept. Its leaders, both in Beijing and Hong Kong, can treat the current crisis as an opportunity to show that a country of 1.3 billion people can be confident and strong enough to allow flexibility and tolerance to be its watchwords. That really would be a lesson to teach the rest of the world.

The views expressed in this article are the author’s own and do not necessarily reflect Al Jazeera’s editorial stance.