Tel: +86 139 0166 8748

HK talks begin in earnest but no indication of outcome

Britain and China resumed their talks on the future of Hongkong here last week, as the colony’s five million residents looked north helplessly wondering what their present and future masters were cooking up for them.

There was no hint in the official joint communique issued at the end of the two-day session on Wednesday which blandly said that the talks had been “useful and constructive.” the Hongkong people are just going to have to sweat it out a bit longer.

having lived on a knife-edge for decades, Hongkong had thought it had learned to forget the future, and worry only about today. but the future is now getting too close to ignore.

zero-hour is 1997, the year in which Britain’s lease on most of Hongkong expires. unless other arrangements are made, the British theoretically will pack their bags on june 30 of that year and be gone by midnight, but the actual method and timing of hand-over will be decided by the talks now in progress.

China says it wants to replace the British administration with one run by Hongkong people themselves — that is “patriotic”, pro-communist Hongkong people. it says Hongkong will become a “special administrative zone” within the People’s Republic, and will be basically allowed to retain its capitalist economic system.

This scenario, however, does not seem to be good enough for many Hongkong Chinese, particularly those with the option of leaving. the vast majority of Hongkong’s residents want the status quo to be maintained. China, they say, should regain sovereignty, and in return allow Britain to stay on for, say, another 50 years. or to quote one l commentator, Britain should be allowed to stay “at least until such time that its departure, or notice of such, would not shake confidence.” Britain appears to be trying to obtain some role in the administration of post- 1997 Hongkong in line with this wish.

Hongkong is a rich and powerful capitalist machine, which has been immensely profitable for almost everyone involved with it — including China. but it is also a highly sensitive and fragile mechanism and has to be handled with great care. one serious mistake by either side could conceivably send the Hongkong dollar and stockmarkets sliding through the floor, and the cash and talent fleeing to safer places where communism is not just a few miles away across the border.

There so much money riding on the issue of the colony’s future, that no-one wants to see it go into a terminal economic decline. but the possibility remains that the prosperous Hongkong of today may not survive this strange duel between British colonialism and Chinese nationalism.

The story of Hongkong’s present troubles goes back to the 1840s when Britain forced China to cede the island of Hongkong to her with a classic piece of gunboat diplomacy known as the first opium war. the British acquired the kowloon peninsula a couple of decades later using similar methods, and in 1898, the Chinese were forced to lease “the new territories” to Britain for 99 years. the lease on the new territories, which makes up most of Hongkong’s land area, expires in 1997, and both sides agree that Hongkong island and Kowloon cannot exist as a separate entity.

so what happens after 1997? uncertainty about this question has had a serious effect on the Hongkong economy already. the Hongkong dollar has dropped dramatically in value, and the local property market is in such a deep depression that it has virtually ceased to exist. China has tried to deny the charge that the impending departure of the British is responsible for Hongkong’s economic instability, but the evidence appears to be conclusive. China and Britain only began addressing the 1997 question in earnest last September when British prime minister margaret Thatcher visited Peking and opened talks with the Chinese leaders.

up until this week, the talks appear to have moved very slowly indeed, with China insisting that Britain must concede sovereignty over Hongkong before discussions on concrete arrangements for the future could be held. Peking now seems to have dropped that condition, possibly as a result of a much- quoted but unconfirmed report that mrs Thatcher recently sent a letter to the Chinese leadership clarifying Britain’s position on the sovereignty issue.

But now, the pace of talks has speeded up enormously after months of nothing at all, two rounds will be held this month, with more apparently planned for august and September. there is no indication of when an agreement might be arrived at, but it may be several months away at least.

The only hint we have that progress has been made is a statement by the Hongkong governor sir edward youde early this month in which he said that Britain and China now had “a better understanding of each other’s positions.” he did not elaborate, but he clearly had something in mind.

an illuminating clue to the British position was provided by a speech made recently by the former governor of Hongkong, lord maclhehose, who said that “if the anxiety of Hongkong people and investors is to be removed, some way must be found to assure them that acceptable arrangements, once made, will not be interfered with.”

“the problem is, unfortunately and unavoidably, recollections of the many changes of line and personalities which have wracked China in the past 30 years and the intimate personal knowledge and experience of them that Hongkong people have,” he said.

In other words, the people of Hongkong require not only an arrangement allowing them to retain their freedoms and life style, but also guarantees that any agreement reached by the present leaders in Peking will be honoured by China’s leaders in the year 1997 or beyond.

The implication is clearly that some outside factor should be included in the arrangements for Hongkong after 1997 to act as a buffer between Peking and the Hongkong people, and the only possibility available is Britain.

for the past year or two, groups of Hongkong people have been invited to Peking to “express their views” on the topic of the territory’s future. but almost all of them seem to have been over-awed at being summoned to the Chinese capital, and almost no-one has had the nerve to tell the Peking leadership the truth: that Hongkong is worried silly by the prospect of re-unification with the communist motherland and needs concrete guarantees that it will be allowed to maintain its present economic and social system after 1997.

But after months of silence, some prominent members of the Hongkong community are finally expressing their views in public, thereby risking being called runnings dogs of the British.

hilton cheong-leen, chairman of the urban council, announced recently that he thought China should allow Britain to continue to administer Hongkong for a further 30 years.

In may, a group of young Hongkong professionals, mostly educated abroad, came to Peking, and told the Chinese what they did not want to hear: that the Chinese plan to have Hongkong people running Hongkong does not provide a suitable guarantee for maintaining the territory’s prosperity, and that the best answer was to allow the British to remain as administrators.

The main problem with the “Hongkong people running Hongkong” idea is that there is no guarantee that the territory will be allowed the degree of autonomy it will require to remain economically viable and attractive as a place of investment. there are also too many contradictions inherent in a communist country allowing the existence of a capitalist enclave such as Hongkong within its borders: it would probably not last long.

some people still believe that China’s statements so far amount to only a negotiating position. optimists looking for hints that China might let Britain stay on in Hongkong after 1997 can point to a recent statement by a senior leader, xi zhongxun, who said that: “China will not take back the government (of Hongkong), but Hongkong must have some reforms.”

as the respected Hongkong newspaper Ming Pao pointed out recently, Britain has three cards in its hand:

– the fact that Hongkong public opinion is overwhelmingly in favour of retaining the status quo.

– the fact the China earns a substantial proportion of its foreign exchange in Hongkong, and stands to lose heavily in the short to medium term if the Hongkong economy collapses.

– the fact that Britain possesses legal sovereignty over Hongkong — until 1997, anyway.

of the three, the sovereignty issue has received the most attention so far, but the other two are probably more important in the long run.

Peking must be aware that if it wants to protect its considerable investments in Hongkong and preserve the territory’s prosperity, any agreement reached with the British must take into account the views of the Hongkong people. an attempt to impose a solution against their will would at best lead to a flight of capital, and perhaps worse things as well. there has even been speculation that many Hongkong people would be willing to become “boat people” in the event of a communist take-over.

no-one knows exactly how important Hongkong is to China economically, but according to some estimates, up to 40 per cent of Peking’s foreign exchange earnings come from this little capitalist pimple on its socialist backside. the question is whether or not economic pragmatism will prevail over the nationalistic desire to reclaim a piece of Chinese territory regardless of the consequences.

Leave a Reply

Close Menu
%d bloggers like this: