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Web-only Exclusives
November 30, 2000

From Our Correspondent: Hirohito and the War
A conversation with biographer Herbert Bix

From Our Correspondent: A Rough Road Ahead
Bad news for the Philippines - and some others

From Our Correspondent: Making Enemies
Indonesia needs friends. So why is it picking fights?

Asiaweek Time Asia Now Asiaweek story

Turning Point

Tung Chee-hwa opens a new chapter in Hong Kong's history


TWENTY YEARS AGO THIS month, Hong Kong Governor Murray MacLehose stressed the need to boost substantially the amount of public housing to shelter the rapidly growing local population. He promised to triple the number of flats available in two years to more than 40,000 annually. "About five or six years at this rate of completion should break the back of the problem as we have known it." On Oct. 8, Tung Chee-hwa made his first address as chief executive of the Hong Kong Special Administrative Region (SAR). Again, housing was a key theme. The current system, he said, has "produced erratic price patterns and left potential home buyers and developers in the lurch." He set as a goal the production of 85,000 new public and private units annually within two years.

Some cynics may wonder how much has really changed since the days of MacLehose. In his 1977 address, the governor spoke of the need to diversify the local economy, raise educational standards and improve support for the elderly and the disadvantaged. All were themes of Tung's maiden speech. But those similarities are pedestrian. All governments must grapple with such basic needs as shelter, food and education. In fact, less than four months into its new incarnation as a city of China, Hong Kong is changing -- subtly but profoundly. And Tung's landmark address brought some key aspects of the transformation into focus.

Most obviously, after 156 years of British rule, the city that is 95% ethnic Chinese is now run by one of its own. Tung is, through and through, a Hong Konger. Born in Shanghai, he moved to the territory as a child. He was educated in the West and assumed the daunting responsibility of reviving his father's troubled shipping empire in the 1980s. He gave his policy speech in Cantonese, another first; it was enlivened by folksy aphorisms that did not translate well into English.

The strategic coherence of Tung's blueprint for Hong Kong also represented a fundamental departure from the past. MacLehose, with his housing initiative, had been the only governor who demonstrated a commitment to tackling local, long-term problems. His predecessors and especially his successors served essentially as political firefighters, reacting to events in the territory -- and in China -- as they arose. In 1984, two years after MacLehose left, London and Beijing signed their Joint Declaration on Hong Kong's return to China on July 1, 1997. For the last British governors, including Chris Patten, the deadline discouraged long-range thinking.

Tung's policy speech, which is something of a five-year plan for the SAR, went far beyond MacLehose's vistas. Hong Kong's new leader unveiled plans to cut the waiting times for public rental housing from six-and-a-half years to four years by 2003 and no more than three years by 2005. He spoke of building major infrastructure links and developing technology parks to diversify the economy into the next century. And he announced concrete initiatives to alleviate the livelihood burdens of the SAR's expanding elderly population.

Crucially and correctly, Tung identified improving competitiveness and education as the key challenges facing the new Hong Kong -- and launched comprehensive initiatives to do so. No less importantly, he stressed the rapidly growing ties -- notably economic, cultural and technological -- between Hong Kong and China. By doing so, he is turning the attention of a new generation of Hong Kongers to the vast opportunities that await them in what is officially their motherland once more. Resisting pressure from both Western and local politicians to accelerate democratization in Hong Kong, Tung cited the measured pace already set out in the Basic Law, the SAR's constitution. Local polls on top popular concerns repeatedly show democracy trailing the major livelihood issues by wide margins.

The chief executive neglected a few key points, though. One is the problem of Hong Kong's cost-competitiveness against Asian business rivals such as Singapore and Shanghai. Stellar property prices, of course, are the chief culprit. Already, some businesses have decamped to Singapore in recent years in search of more reasonable costs. And Shanghai clearly wants at least a piece of Hong Kong's dominant share in financial services for China. Though he mentioned the cost problem, Tung offered no concrete measures to dampen price-inflating speculation. He also needs to re-emphasize more often his government's commitment to two Hong Kong fundamentals: personal and press freedoms, and the rule of law.

Overall, though, Tung's plan for the SAR is notable for its pragmatic, results-oriented nature. It has gone down well in Hong Kong, which exemplifies those attributes. The chief executive has introduced a mild form of industrial policy into a traditionally laissez-faire economy. But unless he goes overboard, that may be a boon that will help the SAR compete in select, strategic industries. Besides gaining Hong Kong's confidence, Tung has also secured that of Beijing, without which "one country, two systems" has little chance of working. Indeed, China's light hand in SAR affairs so far has soothed many pre-handover fears. Sink or swim, Hong Kong is now solidly in the hands of its own citizens.


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