This is me making it up as I go along, but I had surmised that (considering the line says "And they all walk hong-ki-kong") that it had to do with a not very opaque stereotyping of the way the Chinese walk.

But then, I just sing the song. I am no historian.

Howe'er, there is someone more in line with "ethnomusicology" in the midst of my band...I could always ask him.