The Politics of Transition Enbao Wang .i.' ^ m iip Canada-Hong Kong Resource Centre ^ff from Hung On-To Memorial Library ^<^' Digitized by the Internet Archive in 2010 with funding from IVIulticultural Canada; University of Toronto Libraries http://www.archive.org/details/hongkong1997poli00wang Hong Kong, 1997 Canada-Hong Kong Resource Centre Spadina 1 Crescent, Rjn. Ill • Tbronto, Canada • M5S lAl Hong Kong, 1997 The Politics of Transition Enbao Wang LYNNE RIENNER PUBLISHERS BOULDER LONDON — Published in the United States of America in 1995 by L\ nne Rienner Publishers. Inc. 1800 30lh Street. Boulder. Colorado 80301 and in the United Kingdom by U\ nne Rienner Publishers. Inc. 3 Henrietta Street. Covenl Garden. Uondon WC2E 8LU © 1995 by Lynne Rienner Publishers, inc. All rights reserved. Library of Congress Cataloging-in-Publication Data Wang. Enbao. 1953- Hong Kong. 1997 : the politics of transition / Enbao Wang. p. cm. Includes bibliographical references and index. ISBN 1-55587-597-1 (he: alk. paper) 1 . Hong Kong—Politics and government. 2. Hong Kong—Relations China. 3. China—Relations — Hong Kong. 4. China— Politics and government— 1976- 1. Title. bs796.H757W36 1995 951.2505—dc20 95-12694 CIP British Cataloguing in Publication Data A Cataloguing in Publication record for this book is available from the British Uibrarv. This book was t\peset b\ Uetra Libre. Boulder. Colorado. Printed and bound in the United States of .America The paper used in this publication meets the requirements @ of the .American National Standard for Permanence of Paper for Printed Library Materials Z39.48-1984. 5 4 3 2 1 Contents List of Tables ix Acknowledgments xi List ofAcronyms xiii Introduction: The Hong Kong Question 1 The Origin of the Hong Kong Question, 5 The 1984 Hong Kong Agreement, 7 The Basic Law, 8 1 Chinese Policy Toward Hong Kong: A Limited Choice 13 Sovereignty, 13 Chinese Nationalism and the Hong Kong Question, 17 Beijing 's Official Position on the Hong Kong Question, 1949-1 970s, 24 Decolonization of the British Empire, 26 The Emergence of the People's Republic as a Military Power, 28 The Hong Kong Question: A Challenge to Beijing, 29 Beijing's Decisions on the Hong Kong Question in 1984, 32 2 China's "One Country, Two Systems" Policy Toward Hong Kong 41 The Origin of the Concept of One Country, Two Systems, 42 The Principle of One Country, Two Systems and the Hong Kong Question, 44 The Hong Kong Model and the Taiwan Issue, 51 3 The Formation of the S AR"s Political System in the Basic Law 63 Hong Kong 's Current Political System: Its Constitution and Practice, 64 Hong Kong Divided on Democratization and the SAR 's Political System, 68 China 's Position on Hong Kong 's Democratization and the SAR 's Political System, 72 vi Contents Britain 's Influence and Sino-British Compromise, 74 Changes in the Political System, 82 The Systems That Remain Unchanged, 83 From the Declaration to the Basic Law, 84 4 Does the Hong Kong SAR Have a High Degree of Autonomy? 89 An Autonomous Region, 90 Autonomous Region and Sovereign State, 90 Is China a Federal State Under the Basic Law? 91 The Autonomy of the Hong Kong SAR and the Practice ofAutonomy for the Chinese Nationalities, 94 Hannum and Lillich 's Contribution to Understanding the Theory and Practice ofAutonomy and the Autonomy of the Hong Kong SAR, 97 General Governmental Structure, 100 Particular Issues and Powers, 106 Conclusion, 109 5 China's Sovereignty over the Hong Kong SAR 113 The Basic Law States that China, Not Britain, Possesses Sovereignty, 114 The Basic Law States that Beijing Is Sovereign over the SAR, 117 Conclusion, 123 6 China's Modernization and the Hong Kong Question 129 Deng Xiaoping 's Economic Reform and Open Door Policy, 129 Deng 's Reforms and Hong Kong, 145 Conclusion, 154 7 China's Pohcy Toward Hong Kong in the Transition Period 161 Sino-British Cooperation, 162 Influence on Hong Kong and Supportfrom the Hong Kong People, 1 70 Political Reform Within the Scope of the Basic Law, 175 No Concessions to Patten 's Reforms, 1 78 Preparations for the First Government of the SAR, 185 Conclusion, 189 8 China's PoHcy on the 1997 Issue: A Pragmatic View 197 Chinese Policy Toward Hong Kong 1997: A Summary, 197 1 Contents vii China's Policy Toward the 1997 Issues: Challenges and Promises, 201 Conclusion, 204 207 Bibliography' Index 223 About the Book and Author 23 Tables 3. 1 The Composition of Hong Kong's Legislative Council, 1991-2007 81 4.1 Executive Authority of Autonomous Regions 103 4.2 Legislative Authority of Autonomous Regions 105 4.3 Judicial Authority of Autonomous Regions 107 6.1 China's Special Economic Zones (SEZs) 136 7. 1 Chinese-British Differences on Hong Kong's Legislative Council, 1995-1999 181 IX Acknowledgments From the time I chose the topic for my book until the final version that is now submitted to readers, I have greatly appreciated the assistance of the individu- als whose help was vital for completion of the project. Though I cannot men- tion the names of each of those individuals, I do remember their efforts warmly. The following people, however, must be recognized for their significant in- volvement in my research. This book grew out of research material I attained while writing my disser- tation at the University of Alabama, and I would first like to thank my disserta- tion committee chair. Professor Barbara Chotiner. She read my drafts several times and left her corrections, comments, and suggestions on some thousand pages of my writings. In order to help amend my drafts. Professor Chotiner even sacrificed two of her summer vacations. Professor Carol Cassel read the whole of my first draft, corrected my English, and made important suggestions. I am deeply indebted to these two professors for their generous time spent with my manuscript. Without their guidance and assistance, I would not have been able to complete this project expeditiously. Thanks also go to other members of my dissertation committee, Professors John O'Neal, Ronald Robel, and Terry Royed. Their quick response in reading the drafts and providing comments is greatly appreciated. Professor Steven Reed also made comments on my research. In the course of research for this book, I have been ably aided by Professor Xiao Weiyun at Beijing University. My colleagues and friends Shaomin Huang, Marilyn Levine, Xia Li, Guangmao Nie, and Geri Waters offered various forms of assistance. I would also like to acknowledge Bin Yu for his valuable sugges- tions on the content of this book. In addition, Tom Buckly, Brad Lian, and Quddus Addison helped correct my English. I am especially grateful to Martha Peacock, editor at Lynne Rienner Pub- lishers, who helped me to choose the title of the book and offered substantial assistance in the publication process. Susan Hammond's excellent copyediting polished the final form of the manuscript. Let it be noted, however, that the views of this book are entirely my own and I alone am responsible for those views and any errors in this book. XI xii Acknowledgments Finally, I would like to acknowledge the contributions of my wife. Bailing Liang, and my son, Liang Wang. Without their encouragement, understanding, and support, it would have been impossible to overcome so many difficulties in completing this endeavor. Because of their willingness to sacrifice, I was able to concentrate on my research. Enbao Wang Acronyms ARATS Association for Relations Across the Taiwan Straits BDTCs British Dependent Territories Citizens BL Basic Law BLCC Basic Law Consultative Committee BLDC Basic Law Drafting Committee BPF Business and Professionals Federation CCP Chinese Communist Party CPPCC Chinese People's Political Consultative Conference CRC Cooperative Resource Center DABHK Democratic Association for the Betterment of Hong Kong DP Democratic Party EC European Community ETDZ Economic and Technological Development Zone Exco Executive Council FBIS Foreign Broadcast Information Service FEER Far Eastern Economic Review FTZ Free Trade Zone GATT General Agreement on Tariffs and Trade GNP gross national product HK Hong Kong ICCPR International Covenant on Civil and Political Rights ICESCR International Covenant on Economic, Social, and Cultural Rights IMF International Monetary Fund JLG Joint Liaison Group KMT Kuomintang, or the Nationalists LDF Liberal Democratic Federation Legco Legislative Council LP Liberal Party NCNA New China News Agency, or Xinhua NPC National People's Congress PLA People's Liberation Army PRC People's Republic of China xiv Acronyms PWC Preliminary Working Committee SAR Special Administrative Region SEZ Special Economic Zone SEE Straits Exchange Foundation UAE United Arab Emirates UDHK United Democrats of Hong Kong Introduction: The Hong Kong Question The world is watching Hong Kong: on July 1, 1997, Hong Kong, currently a British colony, will revert to Chinese sovereignty. Hong Kong is important to the world economy as a financial, trading, and transportation center. Hong Kong is the bridge between China and the West and between Asia and the rest of the world. Most large corporations have a branch in Hong Kong. After 1997, will the prosperity of Hong Kong, known as the "pearl of the East," be maintained? Will Hong Kong continue to be an ideal place to do business? Hong Kong is greatly different from mainland China in terms of political, economic, and legal systems as well as way of life. With a free market economy allowing private ownership. Hong Kong is capitalist. Although Hong Kong has no democratic system, it is ruled under British common law. In contrast, main- land China is a socialist country ruled by the Communist Party. Will the trans- fer of sovereignty affect the standard of living of the six million people of Hong Kong? Will Hong Kong's capitalism be maintained? Furthermore, why did the Chinese allow the British to rule Hong Kong for over 150 years but also decide to resume sovereignty over the region in 1997? How will China handle Hong Kong? What is China's policy toward Hong Kong after 1997? This book tries to answer these questions by examining China's policy toward Hong Kong and then attempts to predict what will happen after 1997.