In 1997, the British crown colony of Hong Kong is scheduled to revert to Chinese rule under the terms of a 99-year lease concluded in 1898, as modified in 1984 (Cameron, 1991, pp. 192, 322). The end of this last vestige of the British Empire, a territory of rather less than 400 square miles, might seem an insignificant factor in the modern world. But on these 400 square miles stands a city of more than 5 million people, a city that is one of the most dynamic trading and financial centers in the world. The fate of Hong Kong after 1997 is of overwhelming importance to those 5 million plus people and more generally will play a major role in shaping the relationship between China and its neighbors and China's place in the world well into the next millenium.
Moreover, concern over the prospects of Hong Kong after 1997 has been sharply increased since Britain and China negotiated its return in the 1980s. At that time, China was moving decisively away from Maoism and liberalizing both its political and economic policies. Economic liberalization has continued, but political liberalization came to an abrupt halt following the bloody suppression of freedom demonstrations in and around Tienanmen Square in Beijing in 1989. The people of Hong Kong now are confronted with the real possibility that harshly authoritarian political controls--and, perhaps, mass expropriation--might be imposed on them following the restoration of Chinese rule.
These anxieties have only been increased by the current uncertain political situation in China. Deng Xiaoping, now the paramount leader of China, is about 90 years old and visibly in declining health. A struggle for the succession is nearly certain to break out upon his death, a struggle that will pit supporters of continued reform against Communist Party hard-liners ("China's dissidents," 1995, p. 32). The succession struggle is liable to be intensified by the highly unequal division of wealth...