China and Taiwan are about to enter the World Trade Organization, an event that will have far-reaching implications for them and the world. It likely will force fundamental changes in economic relations between the two that could lead to a lessening of tensions across the Taiwan Straits, which remain a major flash point for China-U.S. relations.
In Hong Kong, which has been in the WTO for years, this is causing an identity crisis that may be more traumatic than the handover four years ago from the British to the Chinese. Hong Kong has long played a unique role as the essential gateway to China and as middleman between China and Taiwan.
That’s all about to change.
What won’t change is Hong Kong’s role in that tricky and troubled relationship between China and Taiwan. On July 1, 1997, Hong Kong became the star in the “one country, two systems” model Beijing holds up to Taipei as proof positive that reunification wouldn’t mean an end to democracy and free speech.
The Taiwanese remain unconvinced–and Beijing’s commitment to allow Hong Kong autonomy except for defense and foreign affairs has yet to be fully tested. But the years since the handover have been marked more by pain from the aftermath of the Asian financial crisis than the heavy hand of Beijing.
The British and Chinese agreed in 1984 that Hong Kong would rejoin the mainland in 1997, ushering in 13 years of fear and uncertainty. The resultant human and capital flight was enormous. In the time leading up to the handover, some 40,000 Hong Kongans a year fled to Canada. That has now subsided, and some are returning.
Today, the Special Administrative Region of Hong Kong, as it is formally known, is having to cope with its changing role as it recovers from the financial crisis that ravaged Asia in 1997 and 1998. The question is, how does Hong Kong keep its competitive edge when its role as gateway to an increasingly open China is diminished and its middleman role disappears as China and Taiwan increasingly deal directly with each other?
Hong Kong has always been resilient. When the British took ownership in 1842 of that rocky outpost, its only natural resource was the finest deep-water port in the world. It is still a premier world port and international financial center.
What it can continue to offer is a vital ingredient China still lacks, for all of that country’s remarkable economic progress over the last two decades. That is an internationally respected legal system built on the Western model. When deals are done in Hong Kong, both sides know they will stick and disputes will be resolved by rule of law. That is still far from the norm on the mainland–even in Shanghai, which has become China’s premier domestic financial center.
It is in Beijing’s interests that the world continues to perceive that as Hong Kong’s strength, particularly for the message it sends Taipei. It is therefore in Beijing’s interests to comply with the letter–and the spirit–of Hong Kong’s Basic Law, the document that lays out specifics of the relationship and guarantees autonomy.
Tung Chee Hwa, Hong Kong’s chief executive and, in essence, Beijing’s appointed mayor to the bustling metropolis of 7 million residents, calls it “the equivalent of our Constitution.” Over the first four years, he insists, there have been few “ambiguities.”
That may be. There are seven very vocal opposition parties and Hong Kongans are vigilant about any perceived encroachment by Beijing. Western observers argue that Hong Kong may actually have more autonomy now than under British rule, pointing out the old British law on public demonstrations, in fact, was more Draconian than the Chinese law. What that ultimately means for the Falun Gong and other groups Beijing is determined to discredit and silence, though, remains an open and troubling question for free speech in Hong Kong.
“The real test for a free and democratic Hong Kong,” says dissident Hong Kong legislator Emily Lau, “will be a free and democratic China.” To which Tung says, “China needs to find its own way forward.” He calls the “one country, two systems” terms of reunification “an ingenious way at resolving an historic issue without violence.”
Without violence–and with respect for democracy and freedom of speech. Those all are crucial.
