David Gray/Reuters The first Hong Kong chief executive, Tung Chee-hwa, smiles at Hong Kongs special administrative region opening, Hong Kongs official transfer of power from the British government to Beijing, July 1, 1997. Hong Kong is a Special Administrative Region of the Peoples Republic of China, which has been broadly allowed to run its affairs independently, under one country, two systems, the national unification policy devised by Chinese leader Deng Xiaoping in the 1980s. Under the Basic Law, Hong Kong shall continue as an autonomous special administrative region of the Peoples Republic of China, with its own currency, legal system, and parliamentary system.
Hong Kong maintains its own money, passports, and channels for immigration, as well as its own legal system, but the chain of command leads directly back to the Peoples Republic of China. Multinational corporations and banks–many of which keep regional headquarters in Hong Kong–have historically used Hong Kongs location as a gateway for doing business with Beijing, partly because of its proximity to the worlds second-largest economy and a legal system grounded in British common law. Yet the extraterritorial nature of national security laws means that as Hong Kong becomes more similar to Beijing, people around the world are increasingly invested in its fate — while its younger population feels less Chinese than ever.
While the capitalist enclaves existence poses little substantive challenge for China, the Beijing government will have much harder time to stomach the latest trends in Hong Kongs political evolution. It is crucial for Chinas leadership to act on its realization that Hong Kongs unique nature means that it needs to be managed differently than the rest of China, otherwise the massive outflow of skilled workers and capital will destroy the territorys viability. The legacy of Hong Kongs history as a British-built, anti-Chinese free port will therefore form a central part of the issues surrounding the handover of the territory to Chinese sovereignty today. For diplomatic and commercial reasons, China accepted the reality of British occupation of the territory, but it has always treated Hong Kong as a temporary, separated part of China that will return to the Motherland when the Chinese people choose to reclaim it.
In 1972, only months after Chinas UN seat was transferred to the Chinese government by the Republic of China, who fled to Taiwan in a civil war in 1949, the government moved to exclude Hong Kong and Macao, which returned to Chinese rule in 1999, from a UN list of colonies, effectively stripping them of the right of self-determination. In the late 20th century–with China unwilling to renew its 99-year lease, and Hong Kong unviable without the New Territories–Britain entered long, often fractious negotiations with China on terms to bring Hong Kong back under Chinese administration. First, the British Empire gained control over Hong Kong Island in 1841 following their victory in the First Opium War.5 Second, the British integrated Kowloon, a region just north of Hong Kong Island, in 1860 following the Second Opium War.6 Third, China granted a 99-year lease of the New Territories to the British in 1898.7 This year marked the start of British rule, and formed the foundations for the formation of what we now recognize as Hong Kong. First, the British Empire gained control of Hong Kong Island in 1841 after its victory in the First Opium War.5 Second, the British integrated Kowloon, an area north of Hong Kong Island, in 1860 after the Second Opium War.6 Third, China leased the New Territories to the British for 99 years in 1898.7 That year marked the beginning of British rule and shaped Hong Kong as we know Hong Kong today.4 However, Hong Kong did not really prosper as a trading hub until British rule began, after which it has continued its important role alongside mainland China in Asias markets.
Eventually, China took over Hong Kong in 1997, following the One Country, Two Systems agreement, which for 50 years will maintain a separate economic, political, and judicial system from that of Mainland China. Cheaper labour was brought in, and Hong Kong slowly recovered its pre-World War II status as a highly wealthy, independent colony, but on 1 July 1997, Hong Kong became part of Chinese territory once more, with the British ceding the colony to the Peoples Republic of China. Hong Kong was initially controlled by the Bayue, a Chinese tribe who had moved to Vietnam following Emperor Qins takeover of Hong Kong in the third century BC1. This takeover was part of his campaign to unite what was then a collection of warring states. Hong Kong is composed of Hong Kong Island, initially given to the British by China in 1842, southern parts of the Kowloon Peninsula and Stonecutters (Ngong Shuen) Island (now joined with mainland), given in 1860, and New Territories, comprising mainland areas lying mostly in the north, along with 230 large and small offshore islands–all leased by China for 99 years between 1898 and 1997–and New Territory, comprising a collection of military states.
The British administration responded to rising popular sentiments in ways designed, on one hand, to increase confidence in the British Governments protection of the interests of the people of Hong Kong, and, on the other, to keep good relations with China. Political groups capitalized on a phenomenon where increasingly more people saw themselves as Hong Kongers, or Hong Kongers-in-Beijing, in contrast to identifying as Chinese nationals.