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USF Center
for the Pacific Rim
The Occasional Paper Series of the USF Center for the Pacific Rim :: www.pacificrim.usfca.edu
Pacific Rim Report No. 5, April 1997
Hong Kong and Greater China
by Stephen Uhalley, Jr., Ph.D.



This Pacific Rim Report features a revised version of the keynote address delivered by Stephen Uhalley, Jr. at a conference on "Hong Kong's Reversion to Chinese Sovereignty and Its Impact on 'Greater China'" held at the University of San Francisco on April 17 and 18, 1997 and sponsored by the USF Center for the Pacific Rim and Ricci Institute for Chinese-Western Cultural History.

Dr. Uhalley is the 1996-97 Kiriyama Professor for Pacific Rim Studies at USF, Research Associate at the Center for Chinese Studies at the University of California at Berkeley, and Professor of History Emeritus at the University of Hawaii. His numerous scholarly publications on Asia include a biography of Mao Zedong (1975), a history of the Chinese Communist Party (1988), and an edited volume on Sino-Russian Affairs (1993).

We gratefully acknowledge the Kiriyama Chair for Pacific Rim Studies for funding this issue of
Pacific Rim Report and the Union Bank of California for a grant to fund the "Greater China"research project at the USF Center for the Pacific Rim in 1996-97.

This essay attempts to consider Hong Kong's reversion to Chinese sovereignty in the wider perspective of "Greater China" as a whole and, indeed, for a moment, into a yet even broader context. It is useful to keep in mind that as historic, dramatic, and problematical as this transfer process is, it is hardly an isolated momentous change, for it takes place in the midst of other very profound changes that are currently transforming much of the world-at least the affluent societies or the elites of most societies. What is happening in fast-growing East Asia, in the realm of "Greater China" itself, occurs in the context of this globally broad, changeful environment about which we cannot but be mindful.

Changes wrought by recent scientific and technological breakthroughs are fundamentally affecting the way people throughout the world conduct their lives, frame their thoughts, and interact with each other, both at work and on a personal plane. We are all in the midst of what is truly a sea change, or what Peter Drucker calls one of the infrequent 'divides' in human history, and it is to be emphasized that we are right now in the midst of this transformation, not yet through it, either on one side or the other. It is not at all clear how things will look once we are through this truly dramatic process. We know only that the changes are remarkable and that they have been accelerating.

On the basis of his own vast experience with this contemporary phenomenon, Lester M. Alberthal, Jr., chairman and CEO of Electronic Data Systems Corporation, spoke most eloquently to this same point at the University of San Francisco recently, noting not only that the technological changes underway are leading to a more consumer-oriented business climate, but also acknowledging the great gulf between the generation which largely engineered these technological wonders on the one hand and the younger generation which is taking it all (both the new technology and the pace of change) as given and, therefore, is much more comfortable in using and capitalizing upon the new technologies. It may be added that this is also a younger generation that is assimilating quite naturally the democratizing values of the digital revolution and whose core members (at least in a recent Wired magazine view of it), the so-called postpoliticals of an emergent Digital Nation, are said to be less paranoid about government (as compared to earlier radicals) as they are simply frustrated by its lack of effectiveness.1 It is a technologically savvy, information-accessed generation whose shared views transcend national boundaries, and younger Chinese, whether in Hong Kong, Guangzhou, or Taipei, are as meaningfully a part of it as anyone else, anywhere else.

Technological developments in turn are facilitating the transformation of the global economy, making it more interdependent and, we might note, more vulnerable to sudden shifts of capital and perhaps to a tendency to produce more than is really needed.2 Related to this tectonic shifting of economic plates, the world's political order is facing serious challenges and, voluntarily or not, is undergoing fundamental changes, changes generally distinguished by an ineluctable trend toward greater democratization and more local autonomy. It is precisely at this point that a younger generation is likely to assert itself as opportunities present themselves (initially in local "bread and butter" issues), in China as elsewhere. Beyond this, the post-Cold War era generally remains unsettled, with uncertain shifts and unclear prospects. The very month that saw Hong Kong's reversion also witnessed another development of great historic significance and strategic importance, this one far across the vast Eurasian land mass, the expansion of NATO into Eastern Europe. The effect of this strategic adjustment on the evolving so-called Sino-Russian "strategic partnership," hence on China itself, remains to be seen although it is not likely to be too important in the short run at least.

A Transforming China with Contradictions

Chinese throughout "Greater China" are caught up in these same pervasive highly dynamic developments-even as they try to cope with the enormous changes and challenges that are quite unique to their own experience.

Mainland China itself is deeply immersed in its own unprecedented adventurous process, as Barry Naughton has put it, of "growing out of the plan," the reformist direction of which-toward a socialist market economy-was confirmed by the late Deng Xiaoping's famous southern tour in 1992, a timely gesture which helped sustain the impressive economic performance of recent years. But presiding over market-inspired or oriented reforms has not been a natural thing for an avowedly communist party to do, particularly as long as it needs to maintain its communist/socialist identity. Given such circumstances, it is remarkable that China's leadership has done as well as it has so far, and it has done particularly well in macroeconomic terms.

Yet as impressive as the economic achievements have been, it is sobering to reflect that they take place within the framework of a most daunting economic factor mix, a mix characterized by the extraordinarily large and growing population3 on the one hand and the comparatively modest arable land base (and one that continues to shrink in the face of urban sprawl and other construction works) on the other. These fundamental factors will continue to challenge China's most talented leaders and the hard-working, frugal population for a long time to come, giving them, as ever, little margin for error. Yet that margin is being tested. There are nagging, growing problems, which include: the seriously widening gap between a privileged elite and a vast population that is poor or disadvantaged, particularly the huge floating population, and between the eastern and western provinces; seriously increased crime and large-scale corruption; the continued uncertain balance between central and local governance; the dangerous flirtation with environmental disaster; the potentially very grave rising ethnic strife-all of this accompanied by the evaporation of cohesive ideology and decline of nonmaterial values resulting in a vacuum that is compensated for the time being by economic prosperity and by appeals to nationalism and patriotism. Hopefully, the appeals for a "spiritual civilization" will prove to have content in the future.

In the meanwhile, there are baffling contradictions in the regime's improvised developmental approach that make the road ahead treacherous. How can scientific management (so-called) really work as long as workers continue to be assured that they are the masters of their work places?4 And how can this contradiction be resolved as long as the regularly employed (or under-employed) industrial proletariat who have been among the principal beneficiaries of the People's Republic (that is, aside from the party elite and more recently the new entrepreneurs) remain an important constituency and support for the party itself.5 The continued denial to the same workers of the opportunity to express their specific interests by means of their own organizations, something which, ironically, is increasingly allowed to management in what is an evolving civil society, is merely another complication of the inherent problem.6 In the meanwhile, the party has no recourse but to provide budget-breaking subsidies to many ailing state industries. While China's economic success thus far has promisingly reduced the gap between the affluent sectors of the mainland on the one hand and Hong Kong and Taiwan on the other, such sensitive contradictions raise concern about the continued vulnerabilities of the mainland system, the system that is the overwhelmingly largest component within the "one country, two systems" formula.

Adding to the anxieties attending such difficulties are the political uncertainties. This year is clearly another of those recurrent special years that characterize China's modern political history, the year having already been marked in history by Deng Xiaoping's passing. This was a long-awaited passing that might better have awaited July 1, in order that one of Deng's fondest wishes might have been realized; just as it might better have awaited the conclusion of the impending Fifteenth Party Congress this year, so that Jiang Zemin's own position might more readily have been further consolidated. Fortunately for Jiang, the accrued experience in making and implementing decisions without Deng's participation in the long months before his death has been beneficial for him and the leadership core around him. But until the party congress is convened, the air is rife with political negotiations which will eventuate in compromises and deals arrived at without benefit of the physical presence of Deng, which until now was important regardless of how incapacitated he had become.

Under these circumstances, some compromises may complicate even more the management of the delicate, if robust economy. And, sadly, the current political maneuvering takes place without benefit of systemic political reforms that might revitalize governance in China, such serious reforms having once again been explicitly deferred. This is particularly unfortunate inasmuch as democratic sentiment and practices have continued to evolve in both Hong Kong and Taiwan.

A Cycle of Cathay

Thus Hong Kong's moment of return to China's sovereignty comes at a time when a great deal is going on in the world, developments which affect Hong Kong and China as much as others. It comes at a time when much is going on in China itself, particularly as the economy continues to expand. It is a time when the political atmosphere in China is particularly tense, beyond the fact that the regime's legitimacy remains under a cloud. But, it also comes at a point in a cycle of history when the over-all circumstances are much improved (and improving in certain respects, despite the nagging new problems)-certainly as compared to those in the mid-nineteenth century when China surrendered sovereignty over Hong Kong.

This is a temporal perspective worth reflecting upon for a moment. China, by the mid-nineteenth century, was nearing the nadir of its fortunes, as it was wont to do recurrently through the centuries. This time, the last of the traditional imperial dynasties, the Qing or Manchu dynasty, a particularly lengthy dynasty that had long since passed its prime, was already clearly in decline. The reasons for this decline were the usual ones of corruption, ineptitude, and neglect. But this time, added to the usual recipe for impending dynastic turnover were the two new powerful unprecedented challenges which broke the back of the dynasty. There was the tremendous population explosion that was too much for the conservative polity to handle adequately, as valiantly as it long tried to do using traditional means. And there was the new external threat which this time came from the south, from the sea-consisting of insistent barbarians who backed up demands with awesome cannonades. The intruders demanded that the Chinese accept their imports of opium and required, moreover, that fundamental changes be made to accommodate and facilitate their trade generally, nudging China into compliance with a new world order. Opium, an unfortunate and disgraceful element in the equation, was not the only issue at the time. Even without the drug, there would likely have been an armed encounter at some point. Prideful, frustrated Western imperialists of the time presumably would still have sought to disabuse traditionalistic Chinese of their outdated sinocentric pretensions and to bring China into alignment with the new views and practices in international political relations, commerce, and law, as they muscled their way into the huge but elusive China market.

The timing of the new West's arrival could hardly have been worse for China.

A Cycle of Hong Kong

It was under such circumstances that Hong Kong came to be alienated from China. But Hong Kong was then a relatively isolated place with only a small fishing population. The Manchus themselves put the best face on matters by construing it to be an isolated location where the British could find respite and storage after their long sea voyage.7 There was, after all, the precedent of Macau as such a place for foreigners, a much earlier concession which had never seemed to be much for China to fret over. This suggests that it does not appear to have been a particularly important concession or a particularly offensive or burdensome one at the time, although such concessions early on elicited local xenophobic responses in South China. The British were themselves of divided minds on the choice of location for such an enclave. One ranking contemporary Englishman, Sir James Urmston, favored instead Chusan Island near Shanghai. He argued that Hong Kong in its present condition was not only "an utterly useless island to us, in a commercial point of view, but it is hopeless to imagine or expect that it can ever be rendered capable of becoming an emporium."8

Indeed, Hong Kong was for a long time not all that important in the larger scheme of things; subsequent developments conspired to keep Hong Kong out of the limelight. The opening of Shanghai, along with other ports, was far more important. Shanghai soon eclipsed Hong Kong in most respects and particularly so following another war culminating in the Peking Convention of 1860 which opened access to the interior of China. It was on this occasion that the Kowloon Peninsula along with Stonecutter's Island were ceded, also in perpetuity, to the British-a concession that was by comparison a modest one and located far away in the south, away from the main action. Even the leasing of the much larger tract of 370.4 square miles known as the New Territories and 235 islands and two bays in 1898 during the infamous scramble for concessions at that time was relatively unimportant, except that by now the still slowly evolving indigenous consciousness of what was happening to China made it yet another tangible symbol of national humiliation. Hong Kong, meanwhile, was becoming somewhat more important in the Pearl River Delta subregion and would serve as a convenient haven for political and wartime refugees from China on various occasions over the years.

But it was not until after World War II, and especially after 1949 that Hong Kong, with a population continually swelled by refugees from the mainland, began to come into its own. Even then it was not until the 1960s and 1970s that it began to prosper notably, thanks largely to American military entanglement in the region, a situation in which China was for the United States at least a proxy enemy. Hong Kong's importance to China was unmistakable through this period of growth, especially as it remained a window to the world and a source of revenue-given China's relative isolation in the world community, a consequence of the Korean War, then successively of the split with the Soviet Union, and the Vietnam War. In the subsequent Deng Xiaoping period Hong Kong remained a very important asset to the new economic reform and development program. Of course, all along, China's importance to Hong Kong was at least equally important, as a source of food, water, and labor.

Now the cycle of history has largely reversed itself. Great Britain, long shorn of most of its empire, is in much reduced circumstances. By as early as 1952, it had already explicitly abandoned the idea of attempting to defend against any attempt by China to take Hong Kong. In the years since 1952 Hong Kong has changed, unbelievably changed, even to the point of now comparing favorably with the former metropolitan power in various respects. For example, its per capita Gross Domestic Product (GDP) has in the last five years actually come to exceed that of Britain's.9 Such a comparison is expressed poignantly by the British worker who, fortunate enough to find employment at the new Chek Lap Kok airport construction site, gazes upon the bustling prosperity of the colony that is about to leave the empire and ruefully reflects on the relatively stagnant economy at home.

Concrete discussions about exactly what was to happen in 1997 began in the early 1980s as businessmen, concerned with the need to make business decisions, began calling for the necessary political talks. These began formally in 1982, marked by Prime Minister Margaret Thatcher's visit to Beijing. Her objective to continue British administration after July 1, 1997 in what would have been a split sovereignty arrangement was firmly rejected by Deng Xiaoping. Serious discussions ensued leading to the Sino-British Joint Declaration in 1984, which clearly announced China's intention to renew its sovereignty over Hong Kong and also provided the main features of China's policy toward Hong Kong under the formula of "one country, two systems," a formula that had initially been designed with regard to Taiwan's reunification, but which was now seen as fortuitously applicable to Hong Kong too. The next several years were given to the painstaking drafting of the Basic Law, called for by the Joint Declaration, that would serve as Hong Kong's "constitution" after British colonial rule ceased. This Basic Law for the Hong Kong Special Administrative Region (HKSAR) was finally approved by the National People's Congress (NPC) in Beijing in 1991.

Following the guidelines of the Joint Declaration, the Basic Law succeeded in spelling out the rights of Hong Kong's citizens and of Hong Kong's relationship with the PRC, indicating most importantly that Hong Kong will have a high degree of autonomy, including executive, legislative, and independent judicial powers, with the latter including final adjudication within the SAR itself. It confirms that Hong Kong people themselves will administer the HKSAR, not officials from elsewhere in China. It states that the current economic system and way of life in Hong Kong is to remain unchanged, including the current economic and trade systems. Moreover, its status as a free port, a separate customs territory, and an international financial center is to be maintained. These policies are not to be changed for a period of fifty years from 1997.10

Unfortunately, the June 4, 1989 brutal suppression of democratic demonstrations in Beijing and the massive popular protests in Hong Kong that it provoked had already changed matters. The imminent collapse of communism in Eastern Europe and then in the Soviet Union (and of the Soviet Union itself) along with the rising tide of democracy throughout the world considerably contributed to the changed atmosphere. Partly to bolster flagging morale in Hong Kong and partly in tune with these global developments, London began changing its policy regarding the transfer of Hong Kong. For one, it decided to go ahead with the building of the new airport at Chek Lap Kok without Beijing's consent, making this important investment, for a long while, a contentious issue. Similarly, in 1991, even after the passage of the Basic Law, it approved a new Bill of Rights ordinance.

Differences escalated in 1993 to outright political confrontation when the new governor, Christopher Patten, arrived with a mandate to institute representative government in Hong Kong.11 A series of reforms soon led to the first wholly elected Legislative Council (Legco) in 1995, which prompted Beijing's accusations of violations of previous understandings and of the Basic Law. The notion of a "through train" Legco that had previously been agreed upon when both sides had cooperated on a "convergence" approach to the transfer was now abandoned. For its part, Beijing announced that the wholly elected Legco would be dissolved and in its stead arranged for an alternative provisional Legco. Meanwhile, plans are underway for the new Legco that will come into being within a year of this July along the more conservative lines outlined in the Basic Law.

The conservative regimen was the product of a "united front" consensus between the Hong Kong business elite and Beijing, who together shared a concern primarily for stability and prosperity rather than democratic rights.12 Beijing has subsequently brought itself to accept the emergence of new political parties in Hong Kong, inasmuch as it had taken sides among them. But it is clearly distrustful of the popular and critical democrats, who are not represented (they boycotted the new body) in the new carefully selected provisional Legco even though they had a majority of the elected seats in the 1995-elected body. Martin Lee, the leader of the Democratic Party, fears that in the interim the electoral system will be structured in a way to keep his vocal opposition party out or in the minority.13 Democrat Legco member Christine Loh insists that the Communist Party in Hong Kong now surface itself, something the party seems reluctant to do.14 The tension is palpable.

But the 1991 Bill of Rights remained operational only until July 1. The Chinese argued that these democratic protections are already covered by the Joint Declaration and the Basic Law; and that, otherwise, more than 600 existing ordinances and one thousand items of subordinate legislation will remain HKSAR laws. But one difference is that as a pre-1997 law of Hong Kong such a bill of rights would have been subject to local interpretation, while the Basic Law is subject to the NPC's interpretation.

In December 1996 the first chief executive of the HKSAR, Mr. Tung Chee-hwa, was selected (by the same 400-person body that selected the provisional Legco). Tung then chose and has had approved his team, largely from the outgoing colonial administration, including the able Chief Secretary Anson Chan. This team constitutes the initial executive branch of the SAR government from July 1. The new chief executive is still a strong executive but will no longer preside over or appoint members to the new Legco. There will be a greater separation of powers among the three branches of government than has been the experience in the past (except, i.e., for the last short-lived Hong Kong government), or than is the case in the PRC.

The actual transfer went smoothly enough despite the many details that had to be settled in the very complex and unprecedented operation. The British and Beijing had nothing more to say to each other regarding the political structure of Hong Kong in the final months, but there was cooperation on most matters including arrangements for the entry of the People's Liberation Army. Yet the questions that remain are multifold. How well will it all work out? How much of the current optimism in Hong Kong itself can be attributed to a mixture of Chinese pridefulness, eleventh hour "patriotism," and a kind of forlorn hopefulness? Will Hong Kong's legendary efficiency begin to erode? Will Chinese officials forbear from intervention in Hong Kong's affairs? Will academe, the media, and religious organizations continue to flourish, or will they too-readily self-censor themselves, losing too quickly the vitality that has distinguished these institutions in Hong Kong in recent years? Will the loss of freedom, which has been so important in Hong Kong's success, diminish its future prospects?15

Of course, the greatest guarantee for Hong Kong's continued autonomy other than the prideful desire of the Chinese government to demonstrate that Hong Kong can prosper just as well under Chinese sovereignty is the needed demonstration for Taiwan's benefit. Taiwan's own prosperity and thickening economic relationship with the mainland, largely through Hong Kong, and its amazing political progress in recent years16 had made the large island to the north more sympathetically kindred to Hong Kong than it has been in the past. Taiwan's direct election of its president last year, a truly significant historic first for China, has been the high water mark thus far of this process, although the National Development Conference of December 1996 illustrated exceptional further political maturity.17 Unfortunately, neither event impressed Beijing, which tried to intimidate Taiwan in its conduct of the presidential elections in early 1996; while the December conclave alarmed Beijing because it signaled a consensus within Taiwan on relations with the mainland and because it seemed to represent a retreat from Beijing's view of an acceptable One China stance.18 After Hong Kong's reversion, attention can now focus explicitly and with increasing concentration on the cross-Straits relationship, although the full force of this will be withheld until after Macau's reversion in 1999. Hong Kong's position in this will be interesting to observe but it will be difficult for Hong Kong sources to express views contrary to those of Beijing on the issue.

For the present, Hong Kong brings a great deal to China. It has already brought much and in fact, in terms of economics, is already rather thoroughly integrated with the mainland, as is the mainland in turn heavily invested in Hong Kong. This is another reason to expect that things will continue to go well for Hong Kong under Chinese sovereignty. China's own economic health depends on the viability of this relationship and the economy in turn is important for Beijing politically. Finally, the Hong Kong business elite which has cooperated with China in the transition have much at stake and accordingly can be expected to try to make things work. In any case, the integration that has already taken place has helped give the Pearl River Delta region as a whole pride of place in the modernization of China. And Hong Kong generates impulses of energy and culture that radiate throughout China, however much some of this may be irritating to many mainland Chinese, particularly in the north. Thus, whatever the questions may be about the quality of life in Hong Kong henceforth, a further question looms regarding Hong Kong's place as it is more formally and firmly situated within the Chinese firmament.

Hong Kong and Shanghai

One such consideration is that in the future Hong Kong is again likely to be eclipsed by Shanghai, although not to the same degree that it was in the late nineteenth and early twentieth centuries. But if all goes right, it does appear that Shanghai is set to regain its paramountcy, capitalizing on its own splendid strategic location and tradition, and with the new investments directed its way by a national government which had long neglected or exploited this national asset but which now finally favors its development. The 25,000 active construction sites in the city testify eloquently to the enormous urban transformation that is underway.19 East Shanghai or Pudong is developing a port on the Pacific Ocean that will handle ships in excess of 50,000 tons and will facilitate its becoming the shipping center of the Far East. Its new airport scheduled to open two years from now will have substantially more passenger capacity (60 million) than Hong Kong's heralded new Chek Lap Kok airport due to open next year. Within three years, with the advent of the 21st century, Shanghai could be the leading aviation hub of the region. The Shanghai Financial Center, to begin construction next year (in 1998), will be the world's tallest building (460 meters or 1,508 feet).

Talk of Shanghai becoming China's first fully modernized metropolis, China's "Pearl of the Orient" for the next century, as incredible as it still seems to be for those who have been repelled by the city's congestion and pollution, is no longer far-fetched. And it is gratifying that in the midst of this construction frenzy, there is a refreshing interest to modernize sensibly, with a visible effort being made to preserve what is deemed important from the past. Accord-ingly, more than 1,400 buildings which best exemplify historic architecture are to be preserved. The city has already reclaimed its reputation as the fashion and trend setter for the rest of the country. It is clearly aiming to be the industrial and financial center once again-its new stock exchange is to be twice the size of Hong Kong's. All of this in the service of a populous hinterland that is far greater than Hong Kong's.

With such exciting development and promise for the future, many of the Shanghai immigrants to Hong Kong who were among the most important builders of modern Hong Kong will invariably be attracted back to their home city sooner or later, surely as or if the city becomes more comfortable, convenient, and politically secure in the future. It is no surprise that Hong Kong has already for a long while been Shanghai's biggest overseas investor,20 a supportive flow that is not necessarily reciprocated. It is worth remembering that while Deng Xiaoping's southern expedition in 1992 was a boost to South China's economy and crucially important to the economic reform program the trip had initially been opposed by others in the party leadership, including Jiang Zemin himself. And while there has been grudging admiration for Hong Kong's performance in recent years, there has been resentment too, and some even await the opportunity to take Hong Kong down a notch or two.

In fact, however, Hong Kong can be expected to be inspired by Shanghai's challenge. As a modern city it has a solid head start on Shanghai. And its first new era chief executive, incidentally a native of Shanghai, has already declared that "Hong Kong will be the most important financial, trade, transportation, communication, education, and entertainment centre in Asia."21 The Pearl River Delta area as a whole may not match the Lower Yangtze Basin in scale and over-all promise for the future, but it too has strong natural advantages including its connections to that enviable global network of enterprising kin. It grew with a 18 percent average annual increase of GDP from 1980 to 1993, exceeding average provincial and national levels by 3.9 percent and nine percent respectively. This was a growth rate that surpassed levels for the Republic of Korea, Singapore, Taiwan, and Hong Kong during their respective economic growth spurts. Its continued growth ever since makes it a national leader in terms of duration of fast-track economic development.22 Path-breaking Guangdong Province, especially with its leading edge comprised of the two stellar performing Special Economic Zones of Shenzhen and Zhuhai and the important city of Guangzhou, will surely continue to build impressively, especially with the additional synergy that a more closely and formally integrated Hong Kong may bring. It is also of interest that Guangzhou itself has by the end of 1996 attracted 1.79 billion dollars of investment from Taiwan, including 985 Taiwan-funded ventures.23 The Zhuhai SEZ has been an object of Taiwan's attention, with more than 340 Taiwan-funded enterprises set up there and with 450,000 trips having been made by Taiwan visitors in 1996 alone, making it the second-largest port of entry for people from Taiwan.24

Some in Hong Kong have a very ambitious vision for the larger area in which Hong Kong is located. They see the region soon becoming an economic powerhouse and extraordinary mega-city. Designated the "Pearl City" area (explicitly giving Shanghai's "Pearl of the Orient" a run for its money), it would be one of the richest urban areas in the world, stretching one hundred miles from north to south, with a per capita income of $20,000 (twice that of today's South Korea) for its population of 40 million, and a gross domestic product of $800 billion a year. The plan envisages signal features, including: a rapid mass transport system; what would be the largest state-of-the-art international airport in the world at Chek Lap Kok; the world's largest container port; and fiber-optic communications linking every home. Its leading industries would be trading, investment, transport, communications, tourism, finance and insurance, marketing and design, with the only manufacturing of note in areas of cutting-edge technology.25 We are talking about a scenario that could materialize within the next ten years...if all goes well!

"Greater China"?

Visions such as these of Shanghai and Hong Kong in the near future are not all that incredible because they are set in the context of the rapid development that has been going on along much of China's eastern littoral. Once the obvious political and environmental constraints are surmounted, if they can be, there should be little doubt that such leading edge cities will come into being. These cities would contribute mightily to the well-being of a modernizing China as a whole. Even at present, the composite of the constituent parts of Greater China is already tremendously imposing, even including the obstacles and difficulties,26 and particularly as supported by the considerable resources of Chinese abroad. China really is approaching another apogee, this one in its current cycle of experience. As has been said, in the perspective of its long history, China has merely had a couple of bad centuries. But now it is truly awakening! World historian Felipe Fernandez-Amesto puts it perhaps too strongly, but arrestingly: "The galactic museum-keepers will retain their long-term perspective and see our millennium as continuous with the last and the next-characterized, say, by brief challenges from Islam and the west to an otherwise almost continuous history of Chinese preponderance."27 Consider how much more imposing China will be if its constituent parts would come to work together in full harmony, suffused with an enlivened spirit of cooperation and pride in the larger China family-so that the whole would be greater, in fact, than the sum of its parts.28

It is at this point that the expression "Greater China" as used in the title of the conference, requires a word. The term is a recently restored one that has become popular. It is worth noting that the term as it was initially used upon its restoration in the past decade had a quite different connotation from its previous incarnation earlier in the twentieth century. At that time it referred to what is called continental China, interestingly excluding Hong Kong, Macau and Taiwan, areas which then were still acknowledged to be under the colonial rule of others. Instead, the emphasis at that time was on the combination of the two entities known respectively as China Proper and Outer China, both parts of continental China. The former is the area of high Han Chinese population concentration, i.e., basically eastern China, while the latter comprised the former continental dependencies of the Qing Empire. In the current use of the term, in stark contrast to this earlier usage, there was an initial tendency to apply the term primarily to Southeast China, expressly including a high-lighted Hong Kong/Macau and Taiwan offshore. This is a subregion, among several in and around China, that Robert Scalapino has usefully called a natural economic territory (NET).

However, as China has continued so swiftly to develop economically in the last several years, the current connotation of our term is increasingly an amalgamation of both versions of Greater China, i.e., one that is inclusive of all such Chinese NETs. Accordingly, it now incorporates something of both of what has in the past been regarded as Maritime China-best exemplified in such apogees of Chinese history as the Tang and Song dynasties when China had been notably interested in seafaring commerce-on the one hand, and Continental China on the other. It is an expansive notion that comfortably embraces the dynamic idea now of a rising modern China (Professor Immanuel C.Y. Hsu's title for his important, widely-consulted work-The Rise of Modern China, now in its fifth edition-was prophetic. Today's emerging "Greater China" is the coming to near fruition of modern, rising China.).

The problem is that there is a serious downside to the term "Greater China."29 The adjective "Greater" is more appropriately applied to cities than to nation-states. The notion of hegemony is prominent in both applications but for countries it carries a more threatening connotation, as in, e.g., Greater Germany under the Third Reich. Accordingly, the term contributes to apprehensions among China's neighbors. Authorities in mainland China, sensitive to this, to their credit, do not use the expression. Moreover, for mainland China and its more thoughtful citizens, the term is redundant. China is already great, as they naturally and understandably see it; to use the adjective da (great), as Professor Wang Qingcheng30 has put it, suggests a sense of insecurity, inferiority, or inadequacy that is not appropriate. Certainly such feelings are no longer as serious a problem for China qua country (i.e., as distinct from the current regime which can indeed feel insecure at times) as it has been in the modern past. This cautious reaction to the term having been determined in Beijing, the controlled media is restrained from using it.

It is to be hoped that this caution will persist, but there are disquieting rumors and indications that the post-Deng leadership might stress the nationalist notion of "Greater China" as a key component of a "greater Chinese civilization" with emphasis on Chinese "spiritual values" and cultural traditions.31 In any case, we use the expression "Greater China" here simply because it has become so popular, catching for the time-being something of what is going on in China and among Chinese, something more than is caught in the contemporaneous expression "Cultural China." But it is meant to imply specifically the phenomenon of economic integration rather than political integration, again at least for the time-being. Because of the ambiguity and unwanted connotations the expression is bracketed in quotation marks.

A New Threatening Superpower?

There is talk again these days, reflecting China's growing power and large military expenditures, of it constituting a threat to the region or to the world-a featured topic, for example, in an issue of this year of Foreign Affairs. 32 There are a variety of assessments ranging from new versions of an imminent yellow peril to more sober expectations that China is likely to remain a force for peace and stability in the region, particularly since it is in its own best interest to be a good neighbor. In any case, that China would want to have a respectable or credible military should be understandable. That it is devoting considerable funds, the true amount not being immediately discernible in its published budget,33 to the military now that it has such funds available would seem to be a reasonable enough course in order to make up for a great deal of lost time in past decades. Of course, there can be no certainty with regard to what the present Chinese regime might do under certain circumstances. But the truth seems to be that even with the current considerable investment the Chinese military is not likely to be a serious threat to others until well into the next century, and in the meanwhile any country or countries that would feel threatened by China's developing force projection capability would likely take measures to stay ahead or abreast with needed defense capability. China too must remain mindful of its persistent, gargantuan internal problems and perhaps most relevant along these lines is the considerable internal problem of maintaining its present, largely Qing Empire-determined territorial configuration, i.e., of preventing its outer dependencies of the far west from separating or from becoming too costly to keep under control. These are real time considerations that are likely to keep in check any latent desire for adventurism directed elsewhere.

A Truly Greater China?

We may hope that all will go well with Hong Kong and with China and all the Chinese constituencies. There will always be problems of course, but the biggest problem for the time-being may be the character of the Chinese government itself and its continued resistance to serious political reforms. It is nice to be able to acknowledge that China is a much more relaxed and comfortable place these days than it had been before the Deng era. But Tiananmen remains a spectre, a spectre that hovers all the more hauntingly by the current crackdowns on dissent, by the continued restraints on the Chinese media, by the sporadic harassment of religious expression, and by the less than satisfactory atmosphere in Chinese academe. It is disappointing at this exciting moment in history that as the Communist Party is preparing a leadership roster that is expected to bridge the trans-century period, the opportunity to get on with the postponed structural political reforms (of the Party's own devising during the late eighties) is once again postponed. Instead, patience is yet required as Beijing seeks appropriate means of softening further its authoritarian structures.

The pity is that it is only when such political reforms are truly pursued to the end of realizing a more effectively accountable government that the people of Hong Kong can really feel secure and comfortable as part of the Chinese motherland. Only then, in all likelihood, will a reasonable settlement with Taiwan be achievable. Only then will neighbors feel more fully secure. Only then will China be able to make the most of the global information revolution and become a fully accepted member of the world community. Only then will the appellation "Greater China" signify a country that truly is greater than it has had the opportunity to be in the past.


Notes

1. Jon Katz, "Birth of a Digital Nation," Wired (April 1997): 49, et al. BACK TO TEXT

2. For one clear, dissenting voice regarding important uncertainties in today's international economy, see William Greider's, One World, Ready or Not: The Manic Logic of Global Capitalism, New York: Simon & Schuster, 1997. BACK TO TEXT

3. The Xinhua news agency has acknowledged that the goal of limiting China's population to 1.3 billion by the turn of the century will be impossible to reach with an annual growth rate exceeding 10 births per 1,000; the birthrate in 1996, while lower than it was the previous year, still topped 17 births per 1,000, far exeeding the offical goal. Beijing, UPI, February 5, 1997, on WebNews, February 5, 1997. BACK TO TEXT

4. Liu Rixin, "Enterprise Reform Must Not Change Workers' Status as Masters," Beijing, Zhenli de Zhuiqiu in Chinese, January 11, 1997, No. 1, pp. 9-14, on World News Connection, FBIS- CHI-97-030, January 11, 1997. BACK TO TEXT

5. This theme is pursued ably in Chen Xin's doctoral dissertation, "Socialism + The Market: A Problematic Formula for Management and Labor Reform in China's State-Owned Enterprises," Political Science Department, University of Hawaii, May 1996. BACK TO TEXT

6. Anita Chan and Robert A. Senser, "China's Troubled Workers," Foreign Affairs (March/April 1997): 104-117. BACK TO TEXT

7. The Chinese text of the treaty uses this euphemism. Immanuel C.Y. Hsu, The Rise of Modern China, Fifth Edition. New York: Oxford University Press, 1995, p. 190. BACK TO TEXT

8. Frank Welsh, A Borrowed Place: The History of Hong Kong, New York: Kodansha International, 1993, p. 124. BACK TO TEXT

9. Welsh, A Borrowed Place, p. xii. BACK TO TEXT

10. An excellent analysis of these events is provided in Enbao Wang's Hong Kong, 1997: The Politics of Transition, Boulder, Colorado: Lynne Rienner Publishers, 1995. BACK TO TEXT

11. Subsequently released British Foreign Office papers would reveal that London explicitly rejected any notions of fully representational government in Hong Kong as far back as 1966 for fear of China-related repercussions, information which gave credence to Britain's assertion that various historical factors, including Chinese opposition, resulted in this eleventh hour introduction of democracy in Hong Kong. UPI, Hong Kong, January 13, 1997, WebNews (ClariNet e. News), same date. BACK TO TEXT

12. Dr. Cindy Y.Y. Chu's doctoral dissertation elaborates this process very well: "The 'New Era's Patriotic United Front,' The Hong Kong Question, and Implications for China's Reform," Department of History, University of Hawaii, May, 1996. BACK TO TEXT

13. Interview with Martin Lee by Gabriel Bertinetto in Rome, L'Unita in Italian, February 17, 1997, p. 12, on World News Connection, FBIS-CHI-97-034, February 17, 1997. BACK TO TEXT

14. Christine Loh, "Breaking Through Wall of Silence," South China Morning Post, March 4, 1997, p. 21, on World News Connection, FBIS-CHI-97-063, March 10, 1997. BACK TO TEXT

15. The critical importance of freedom in Hong Kong's experience is a strong theme of many books and articles, e.g.: Robert Cottrell, The End of Hong Kong: The Secret Diplomacy of Imperial Retreat, London: John Murray Publishers, 1993, and Bruce Bueno de Mesquita, David Newman, and Alvin Rabushka, Red Flag Over Hong Kong, Chatham, New Jersey: Chatham House Publishers, Inc., 1996. BACK TO TEXT

16. See Tse-Kang Leng, The Taiwan-China Connection: Democracy and Development Across the Taiwan Straits, Boulder: Westview Press, 1996, for a sophisticated analysis of this fascinating dual development. BACK TO TEXT

17. The Resolutions of the National Development Conference have been usefully made available as a removable insert in the Free China Review (March 1997), along with a special section of follow-up analyses and discussion, pp. 29-43. BACK TO TEXT

18. See, for example, Hua Qing, "'Equal Political Entities': An Illegal, Illogical, and Unreasonable Theory," Xinhua Domestic Service in Chinese, February 28, 1997, on World News Connection, FBIS-CHI-97-041, March 4, 1997. BACK TO TEXT

19. J.D. Brown, "Shang High," Hemispheres (February 1997): 70-73. BACK TO TEXT

20. According to Shanghai Vice-Mayor Zhao Qizheng, reported on Beijing Xinhua in English, February 19, 1997; World News Connection, FBIS-CHI-97-034, February 21, 1997. BACK TO TEXT

21. Tung Chee Hwa's speech "Building a 21st Century Hong Kong Together," October 1996. BACK TO TEXT

22. Li Ning, "Pearl River Delta Heading Toward Modernization," Beijing Review, January 27- February 2, 1997, p. 12. BACK TO TEXT

23. According to He Jiaxin, deputy director of the Guangzhou Taiwan Affairs Office, reported by Beijing Xinhua in English, February 23, 1997; FBIS-CHI-97-036, February 23, 1997. BACK TO TEXT

24. The 1996 figure is double that for the previous year, thanks to the opening of the new, modern Zhuhai Airport and the commencement of air routes between Taiwan and Macau. Macau is located contiguous to Zhuhai. Beijing Xinhua in English, February 9, 1997; World News Connection, FBIS-CHI-97-027, February 11, 1997. BACK TO TEXT

25. This vision was articulated by David Li, chief executive of The Bank of East Asia Ltd., according to a Reuter dispatch from Hong Kong, posted on WebNews, June 28, 1996. BACK TO TEXT

26. This phenomenon is spawning a new literature. A useful scholarly volume is Linda Fung-Yee Ng and Chyau Tuan, eds., Three Chinese Economies: China, Hong Kong and Taiwan: Challenges and Opportunities, Hong Kong: The Chinese University Press, 1996. BACK TO TEXT

27. Felipe Fernandez-Amesto, Millennium: A History of the Last Thousand Years, New York: Scribner, 1995, p. 735. BACK TO TEXT

28. For a sober, independent assessment of issues involved in this rise of "another intellectual village industry producing theories, sometimes rhapsodies, on the theme of an emergent 'Greater China'," see Jan S. Prybyla, "China as an Asian Economic Power," Issues & Studies, Vol. 33, No. 1 (January 1997): 1-22. BACK TO TEXT

29. See also Stephen Uhalley, Jr., "'Greater China': The Contest of a Term," positions: east asia cultures critique, Vol. 2, No. 2 (fall 1994): 274-293, and Harry Harding, "The Concept of 'Greater China': Themes, Variations and Reservations," The China Quarterly, No. 136 (December 1993): 660-686. BACK TO TEXT

30. Past director of the Institute of Modern Chinese History, Chinese Academy of Social Sciences. Professor Wang's remark was made during a discussion with me in Beijing in October, 1993. BACK TO TEXT

31. See Jamie Mackie, "Rhetoric Is Risky, in Light of Diversified 'Chinese' Culture," The Asian Wall Street Journal, Weekly Edition, November 11, 1996, and "Ancient Roots of China Diaspora Tapped in Push for Unity," Christian Science Monitor, Hong Kong, January 8, 1997, WebNews. BACK TO TEXT

32. The "debate" between Richard Bernstein and Ross Munro on the one hand and Robert Ross on the other under the title "The China Threat" in the March/April 1997 issue. BACK TO TEXT

33. For differing views on this subject see, on the one hand, "Experts View Defense Spending," AFP, Beijing, March 3, 1996, on World News Connection, FBIS-CHI-97-062, March 7, 1997, reporting the estimate by the London-based International Institute of Strategic Studies that real military spending by China is four times higher than the announced budget; and on the other hand, Liu Yue-ying, "Why Finance Minister Has Become Angry-Liu Zhongli Analyzes Increase in Defense Spending," Hong Kong Ta Kung Pao in Chinese, March 3, 1997, p. A2, on World News Connection, FBIS-CHI-79-043, March 6, 1997. BACK TO TEXT


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