In the Wake of Beijing: China's Hardline Response to the Beijing Uprising Aroused Horror St the Implications for Hong Kong's Economy. but Rather the Damage Has Proved Political

By Wilson, Dick | Management Today, August 1989 | Go to article overview

In the Wake of Beijing: China's Hardline Response to the Beijing Uprising Aroused Horror St the Implications for Hong Kong's Economy. but Rather the Damage Has Proved Political


Wilson, Dick, Management Today


IN THE WAKE OF BEIJING Thirty years ago the late Richard Hughes, probably the best-known foreign correspondent in Hong Kong, filed a story to The Economist about the riots which had just brought Hong Kong to a standstill. It was published under the headline 'Hong Kong Has Had It' and was one of the few things Hughes came to regret in later life, as Hong Kong rebounded from the chaos to resume its fast road to prosperity. That resilience is worth remembering in any evaluation of the impact of the Chinese riots today.

When Premier Li Peng declared martial law in Beijing without regard to constitutional requirements, a wave of despair flowed over Hong Kong. If the Chinese Government itself placed so little value on laws and constitutions, what credibility could the Hong Kong Basic Law guarantees have? It was unprecedented, and quite unexpected, that one million Hong Kongers would demonstrate in the streets in the cause of mainland political liberties. It marked a further stage in the development of the elusive Hong Kong identity as a Chinese city marked out for a special destiny.

Yet, although it was a horrifying series of incidents that the world witnessed on its TV screens in Beijing, it never came anywhere near the civil war that was talked about, and public life quickly began to return to normal after the victory of the conservative Communist Party hardliners.

What happened in Beijing was primarily a student uprising, with a small number of industrial workers, professionals and officials drawn in at the final stages. It represented a cry of anguish from young intellectuals about the slow progress which China is making towards political freedom. But that is not something which greatly excites the industrial workers and farmers who constitute the vast majority of the population, not to mention the millions of men and women who serve in the Communist Party and Army. For all these reasons it is likely that the Chinese Government will maintain its economic reforms, though without conceding political reforms, for the next few years.

This is disappointing to most intelligent Hong Kongers, but many more developments could take place before 1997. By that time most of the six or seven octogenarians, including Deng Xiaoping, who are currently leading the Communist Party will almost certainly have gone to join Marx - to be replaced by others of a less conservative bent, people less enamoured of the past and more aware of the realities of the contemporary world.

Hong Kong businessmen are tough; they are used to drawing profit from countries with hopeless politics. But even they were shocked by the Tiananmen Square massacre, and said things in the heat of the moment indicating a total loss of confidence in China and Hong Kong's future. Yet such people are also quick to pick up the threads where possible.

Hong Kong investors have set up so many factories in Guangdong province that at least two million Chinese work in them. The Shenzhen Economic Zone just across the border from Hong Kong showed no economic effects from the recent troubles, and construction work at the Daya Bay nuclear power station, continued.

The enmeshment of capitalist Hong Kong in mixed-economy China is remarkable. Indeed, trade between them actually rose by 35% last year.

And much of the initiative in Hong Kong was, until 4 June at least, being taken by China. Chinese investments are evident in almost every sector of the Hong Kong economy. In the past three years China Resources, the most important mainland-owned general trading corporation, had invested US$550 million in a wide variety of projects, including a new container traffic terminal and the new tunnel in which Jardine Matheson and the Swire group are also involved. …

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