Hong Kong's return to China: winners and losers

June 4, 1997
Issue 

By Eva Cheng

June 30 will be the last day of Britain's 155 years of colonial rule in Hong Kong. A majority of Hong Kong's people are keen for the end of a long period of humiliating subjugation. Around 98% of the population is ethnic Chinese, and many still maintain family ties in China. But the reversion poses dilemmas for them, because of fears that Beijing will extend its undemocratic and brutal rule to Hong Kong.

On the other hand, Hong Kong Chinese big business can't wait to embrace the new master, having done well in the last decade from the overhaul of China's social and economic system. They and some smaller capitalists have shifted the bulk of Hong Kong's manufacturing base to China, mainly in the provinces just across the border, employing about 5 million cheap labourers.

These large businesses have enthusiastically expressed loyalty to Beijing, and they keep rolling out investment deals in various parts of China, even though few of their owners haven't secured a foreign passport and foreign assets, just in case.

Fearful of the handover, an estimated 250,000 of Hong Kong's 6 million people have migrated, mainly to Australia and Canada.

In the last few years, the mobilisations for democracy have been unprecedented, encouraged by the same colonial government which suppressed such activities until not very long ago. Meanwhile, Beijing has been threatening and manoeuvring in a desperate attempt to stop the dismantling — however partial — of Hong Kong's repressive political structure.

British rule

By turning a blind eye to history, even events only a few years old, the bulk of the western media portray the situation as one of democracy under threat. In fact, as recently as the '70s, the colonial government was still cracking down on dissent and social protests with the help of various repressive laws, whipping up fear against communism and red-baiting dissidents, weeding out expatriate activists (such as those who campaigned against the Vietnam War) by denying them visas and intimidating activists with its secret police.

Hong Kong people had no say in the running of their society. London ruled through a colonial governor who dictated behind the facade of two bodies — the Legislative Council and Executive Council. The former was made up of government officials and appointees. The Executive Council was also entirely hand-picked by the governor, filled by the top capitalists and their cronies, to give him "advice".

For the general public, the thing closest to democracy was the "public consultation", consisting of submissions commenting on a government green paper, the results of which the governor had full discretion to ignore.

The colonial government first floated the idea of "representative government" only in mid-September 1984, one week before the Joint Declaration with China under which it would return all of Hong Kong to Chinese rule in 1997. In the same announcement, China promised elections to Hong Kong's legislature after the handover.

Elections

There had been no shortage of calls over the years for a more democratic political structure, but London ignored them all. In this belated change of heart, some Legislative Council seats were to be elected in 1985 on a very narrow franchise, with the hand-picked components reduced to a minority by 1991. Some Executive Council positions were to be chosen by the non-appointed Legislative Council members in 1988.

Just 1% of Hong Kong people were eligible to vote in this election — only members of selected professional and trades groups, and local councillors.

London said in 1984 that a review of this process would be conducted in 1987, to determine whether 1988 was a good time for direct elections to the Legislative Council. Come 1987, however, a popular call for a referendum on direct election was rejected in favour of yet another "public consultation".

Most of the submissions focused on the direct election, with 39,000 in favour and 94,000 against. Over 95% of those opposed were identical printed letters, including 22,722 from the Beijing-controlled Federation of Trade Unions and 900 from the stock exchange. Beijing adamantly opposed any direct election in Hong Kong before 1997.

Meanwhile, 230,000 names gathered in a signature campaign in support of direct election, all backed by identity card references, were excluded from the official tally. It was anything but a surprise when the survey office "recommended" postponing to 1991 the direct election, which would be applicable to only 10 out of 56 seats.

Even after the Tiananmen massacre in 1989 triggered street protests of more than 1 million Hong Kong people demanding democracy, only a few seats were added to the directly elected list for 1991.

The "political reform" speeded up from late 1992, following the arrival of the last governor, former Tory party chief Chris Patten. In September 1995, the entire Legislative Council was put up for election, although still only 20 seats were for the popular vote, the remaining 40 being chosen by narrow selected groups, as in 1985.

Even this very partial "democracy" did not please Beijing. After failing to block the 1995 election, it pumped in big funds to field candidates under its influence, wining and dining widely in soliciting — and extorting — support.

Despite this, it won only 16 seats, compared to 26 from the so-called pro-democracy camp led by the Democratic Party. The DP, which played a key role in support of the dissidents in China in the wake of the Tiananmen massacre, was labelled "subversive" by Beijing and warned it wouldn't be tolerated after July 1.

'Transition'

Beijing has already started running the show. In the "transitional legislature" which Beijing formed last December, all 19 legislators from the DP were ignored, but 10 pro-Beijing candidates rejected by voters in 1995 were included.

The formation of the entire legislature was supposed to be a Hong Kong affair under Beijing's 1984 promise to give Hong Kong "high autonomy". Beijing recently promised elections for the legislature in 1998, but if Deng Xiaoping's word still carries any weight, it will not be by universal franchise. Deng ruled that out in 1987.

Beijing has also qualified which Hong Kong hands it can trust. Not the unpatriotic ones, it says, who harm the territory's "stability and prosperity". Nor those who prefer the "western" focus on individuals' rights rather than "Chinese" emphasis on "obligations to the community", according to Hong Kong's chief executive in waiting, Tung Chee-hwa.

China's vice-premier, Qian Qichan, also made clear that the extent of freedom of expression in post-July Hong Kong will be defined by Beijing.

Armed with 60,000 supporting signatures, eight DP members last year tried to petition Beijing against the undemocratic formation of the transitional legislature, but weren't even allowed to deliver the petition.

The handover only formalises a political integration that is already well under way. Tung Chee-hwa was "recommended' by a 400-member selection committee appointed by Beijing.

Tung has already appointed an 11-member Executive Council, running a shadow government, staffed by 29 bureaucrats "borrowed" from the colonial government. In the last few months, he has scrutinised all 23 top positions of the colonial government, offering a job in the new government to most of them.

Under the 1984 agreement, China was to limit its intervention in Hong Kong to defence and foreign policy for 50 years after July 1997. There is little doubt now that Beijing will not confine itself to such a limited jurisdiction.

Business interests

An elaborate network of mainland institutions and interests already operates in the territory. In Hong Kong, China is already issuing bank notes and owns at least 15 banks, substantial stakes in two airlines, key utilities, major infrastructure and shipping and trade interests, employing hundreds of thousands.

Conversely, Hong Kong is playing a key role in China's capitalist transformation.

Apart from being the biggest source of foreign capital, Hong Kong also provides China with accounting, legal, shipping, air transport, communications and financial infrastructures which are essential to its reintegration with the world capitalist system. Foreign capital has been using it as a base to conduct mainland ventures, a process that will be enhanced after July 1.

China's fledgling capitalists and Hong Kong capitalists are increasingly mates and golfing partners, wheeling and dealing together in Hong Kong's stock and foreign exchange casinos.

Hong Kong capitalists have by far the biggest and most strategic representations in key transitional bodies such as the Basic Law Drafting Committee, the related consultative committee and, more recently, the committee in the selection of the new chief executive. Tung is himself a top Hong Kong shipping owner.

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