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Radicals Rising
The local establishment is alarmed. Will activism erode Hong Kong's business edge?

 Activist: Student leader Gloria Chang on why hidebound official attitudes are feeding the activism
• Icon: Is veteran protester "Long Hair" joining the establishment?
• Activist vs. Tycoons

You could call the University of Hong Kong's student union Radical Central. A sleeping bag, discarded by a student after a late-night session plotting a political protest, lies on the floor. Loudspeakers are stacked in the corner. A banner criticizing a government law requiring police permission for protests hangs on the wall. A group of students recently was arrested — though charges weren't pressed — for demonstrating without permission. The incident triggered a flurry of attacks on the government's rigid approach. That, in turn, sparked rare public criticism from the city's business establishment, who worry that street protests will disrupt commerce.

Gloria Chang, the union's president and just over five feet tall, may look frail. But she's a fighter. She and fellow students have taken to protesting against everything from political interference in academia to undemocratic government. "I worry about my parents — they think, 'why can't their daughter just go to university, study and get a job?'" says Chang. "But I know what I'm doing. We need an open government, and we want it now."

This is Hong Kong? Until recently, the territory has been known for pragmatism, not protest. Its industrious residents, many former refugees who had fled the Chinese Communists for a better life, avoided politics and taught their children to work hard and make money. But since the former British colony was returned to China in 1997, it has been hit by the Asian financial crisis and other man-made disasters. The government, led by Chief Executive Tung Chee-hwa, seemed to retreat behind closed doors, making key decisions with little if any input from the public.

In frustration, students, social activists, ecology groups, teachers, doctors and ordinary Hong Kongers have started clamoring for their rights. Street protests have become commonplace, no longer the preserve of fringe elements. "Hong Kong has turned radical," says Mei Ng, one of the city's best known environmental activists. "We have exhausted peaceful means of communicating with the government." Hong Kong already faces growing competition for investment. If the special administrative region (SAR) becomes further radicalized, will it lose its edge as Asia's leading business center outside Japan?

For now, many foreign investors still prefer Hong Kong. They say the city's rule of law and relatively transparent business practices make it a good place to do business. Investment figures show no discernible decline. And the imminent entry of China into the World Trade Organization will provide an added boost to Hong Kong's traditional entrepot role. But local Chinese tycoons, conservative patriarchs who have been building business empires — and political relationships — in China, are drawing lines in the sand. In August, property magnate Li Ka-shing lashed out at criticism of his family's control of a huge portion of Hong Kong's stock-market capitalization. "I try my best to stay free from politics," Li said. "But if the media and politicians orchestrate together, I'll reduce my investment in Hong Kong." Another tycoon with close mainland ties, chairman Gordon Wu Ying-sheung of Hopewell Holdings, cast the debate in even more apocalyptic tones: "Workers confront their employers, students accuse their school heads, members of the public oppose the government," he said to a visiting mainland leader recently. "They are just like Mao's Red Guards during the Cultural Revolution on the mainland."

The polarization has grown worse since the 1997 handover. In the leadup to that event, it became clear to Hong Kong people that local business chiefs were playing an increasingly important political role. A small group of them, appointed by Beijing, chose Tung, himself a shipping magnate with longstanding ties to China (Beijing bailed out his family's failing empire in the mid-1980s), as chief executive. Uncomfortable with politics, Tung often chose to ignore the views of the territory's most popular politicians, the leaders of the Democratic Party. Even within the government bureaucracy, he is faulted for a reluctance to consult. Civil service reforms, says chairman Felix Cheung Kwok-bui of the Hong Kong Civil Servants General Union, were presented as a done deal. "The government simply bypassed us, imposing the reforms on us and trying to get us to agree to the harsh terms," he says. "That's not the way things should work."

Even compared with politically charged 1997, the number of demonstrations has risen. The first 10 months of 2000 saw 518 protests and 479 assemblies; in 1997, there were 448 and 425 respectively. "These people [the establishment] just think they don't have to change their closed-door ways," says one senior government official. "They think the protesters are part of some conspiracy to undermine Hong Kong's stability. They don't see this as being related to the way the government does things."

Hong Kong's political parties are jumping into the fray. Lee Man-fun's business is a victim of politicking. The government recently evicted Lee's equipment company from the industrial building it had occupied for 13 years. The edifice was to make way for a railway project. Lee was offered compensation, but was seeking more money. Then political parties started to offer him assistance. "At first, it was really confusing with the parties all wanting to organize protests on our behalf," he says. In the end, Lee felt the parties were looking to exploit his difficulties for publicity. "The issue got distorted and real debate got stifled," says Lee. "Instead of calmly negotiating over compensation, the government spent many hours resolving conflicts with the Democratic Party and the [rival, pro-Beijing] Democratic Alliance for the Betterment of Hong Kong. Nothing constructive was accomplished."

Lee has now closed down his company — a fate that has befallen many other businesses in the same building. "This should have been a business decision, period," says Lee bitterly. "But it was highly politicized and in the end our business lost out." Adds Eden Woon Yi-teng, director of the Hong Kong General Chamber of Commerce: "The more bickering there is, the more people [in business circles] shake their heads." But the chamber itself recently joined the political fray by defending the government's refusal to amend the Public Order Ordinance, which requires demonstrators to get advance permission from the police to stage protests.

The business community had best get used to operating in an increasingly politicized environment. Besides students, environmental groups like Mei Ng's Friends of the Earth have been forerunners in street politics, agitating against everything from dirty air to water pollution caused by the construction of Disneyland on outlying Lantau Island. Their many lobbying campaigns, press conferences and mass rallies have met with some success. A government proposal to build a road link cutting across Lantau, the habitat of many rare species of flora and fauna, was scuttled in November, while another proposal to build a rail link in a pristine conservation area was rejected the previous month.

The warriors of Hong Kong's new radicalism, however, are not always as benign as noisy students, dedicated tree-huggers and pinstripe-suited politicians. During a recent court battle by mainland children to get local residency rights, some protesters led an arson attack at the Immigration Department. Two people were killed. This tragedy, more than anything else, hammered home the highly charged nature of the current political climate.

There have also been protests about housing. Homeowners, watching the value of their flats tumble, complain that Tung flip-flopped on his housing policy — without telling the public. (He originally promised to build 85,000 apartments a year, then quietly reversed his plan after the Crisis hit.) Teachers, too, have gone to the streets, protesting government plans to impose new English tests. Again, they complain about a lack of consultation. "The more the government tries to stall us, the more frustrated people get," says environmentalist Ng. "Tung has initiated so many half-baked reforms that alienate people and affect their livelihood."

In the prevailing climate, even the Democratic Party has had to make adjustments. The party has been embroiled in an internal struggle, with the mainstream leadership at odds with a faction of so-called Young Turks. The latter have been pushing for a more radical, grassroots-driven approach than the leaders are comfortable adopting. For example, the Young Turks want to push for a minimum wage, a policy old-line Democrats oppose. The split has led to the departure of some rebels, but there are signs that the party is adding a dash of radicalism to placate its restless members. Chairman Martin Lee Chu-ming and vice chairman Yeung Sum, both buttoned-up members of the Democratic establishment, recently marched at the front of a (technically illegal) rally in support of the students who had been arrested for breaking the public order law.

Government critics blame the rise of radicalism on Tung — and the fact that Hong Kong is a half-baked democracy whose leader is selected by a pro-Beijing elite and only 24 of the 60 seats in the Legislative Council are filled through popular elections. The political framework offers few effective channels for the public to assert its political will and express its grievances. Tung's disdain for democratic debate has exacerbated the problem. "It's a feeling of disempowerment," says former student activist Chris Chan King-chi. "Government advisory committees have no transparency," complains Ng of Friends of the Earth. "The agenda is not open, nor are the meeting minutes, nor do we know how members are selected."

The real danger may be that Hong Kong people increasingly believe there are no normal avenues through which their complaints can be addressed. "It's a structural problem," says Lee Cheuk-yan, legislator and general secretary of the Confederation of Trade Unions. "The establishment cannot keep pace with people's demands for democracy and more involvement. If popular frustrations are not channeled, it's like having a time bomb." Staging demonstrations is often the only way the public can make its voice heard. In fact, it may be the only way people know how. "The public lacks civic education," notes former legislator Christine Loh Kung-wai, who quit politics earlier this year because she felt she could not effect changes within the current system. "They are not given the chance to learn political skills. They only know how to protest and ring the phone-in shows."

And protest is often the only tactic that gets the government's attention. Civil servant leader Felix Cheung points to a planned 40,000-strong protest rally by bureaucrats in July that was averted only after Tung's last-minute intervention. "Before we publicized our intention to carry out mass demonstrations, nobody cared," he says. "Immediately after one of our sub-groups announced the protest, Tung promptly met with us."

But if radicalism spreads, Beijing may eventually feel the need to step in. Gordon Wu's dramatic reference to the Cultural Revolution may seem a touch hyperbolic. But try telling that to mainland leaders, for whom the memories of the catastrophic ideological campaign remain painful. Insiders familiar with Beijing's thinking say that Chinese leaders are increasingly concerned that growing public protests could further undermine the credibility and authority of Tung and his administration. "Seventy-year-old leaders in Beijing see all the street protests in Hong Kong and they almost reflexively think: Cultural Revolution," says a Hong Kong business consultant with close ties in China. "They fear the radicalism will undermine Hong Kong's stability and prosperity, to them the SAR's most valuable asset."

The protests are having a real impact on business in Hong Kong — but largely for the better. The pressure from green groups has led some companies to be better corporate citizens by putting the community good on a par with profits. After stern objections over the abolition of its recycling policy, soya milk producer Vitasoy reinstated its policy of paying six U.S. cents for every empty glass bottle returned. Hong Kong flag carrier Cathay Pacific has been phasing in environmentally friendly measures, including collecting used menu cards for recycling and changing napkin colors to cut the use of harmful bleach. Ng says that over five years, the measures have saved the airline $2 million.

And in spite of establishment fears, some foreign businessmen actually argue that the new climate of protests is a sign of progress. "Overseas investors recognize these protests as a process of democratic development," says Paul Woodward, a governor of the American Chamber of Commerce. "It's good that people are engaged in policy debates, rather than packing their bags and moving to Vancouver." Environmental protests don't necessarily scare away overseas capital, either. "I don't think foreign investors choose to invest where they can dump the dirty factories," Woodward adds. "They would in fact look at the environment because they would be bringing their families with them." Perhaps, as Nicholas Brooke, chairman of Brooke International, a property advisory firm, suggests, "Hong Kong is finding its new destiny."

Student activist Gloria Chang's commitment to creating that new Hong Kong has not wavered, even though it might cost her a government scholarship to study abroad: "If I can't get the money because the establishment doesn't like what I've done, I'll just have to deal with it." That defiant stance is surely anathema to Tung Chee-hwa, Hong Kong's tycoons and Beijing. They are convinced that the politicization brought about by the likes of Chang does not augur well for Hong Kong's future. Unfortunately, that view could become a self-fulfilling prophecy. If local citizens feel they have more avenues of expression, society and the economy will flourish. But if they feel ever more excluded from the levers of power, the number and scope of protests will continue to mount.

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