China and Hong Kong Relations One Country Two Systems

Chinaand Hong Kong Relations: One Country Two Systems

Chinaand Hong Kong Relations: One Country Two Systems

“One country two systems” as a legal principle is said to havebeen designed by Deng Xiaoping. Early known as the Supreme leader ofthe PRC (the People’s Republic of China came up with the dogma toreunify China as a country during the 1980s. The policy meant thatChina was to maintain a communalist organization while Hong Kong wasto remain under a capitalist classification.

HongKong is not a country on its own but is part of China. Nevertheless,it is also not a province. It is an Island at the coast situated awayfrom the southern coastline of China. It started with its unificationinto the former Chinese kingdom for the period of the Qin Empirebetween 221 BC and 206 BC. Hong Kong began as a salt manufacturerplace, fishing village, and trading field, which advanced, later on,to be a military seaport of diplomatic status and in the long run anInternational Center (Lee, 2005). In 1839, the British governmentconquered China to overthrow the opposition due to its meddling inthe states` political, economic and social, affairs. Britain`s mainagenda of the battle was to inhabit the Hong Kong region, which was asporadically occupied island. In 1841, China abandoned the area tothe British colony after an authorization of the agreement ofChuenpi. Later on, the Treaty of Nanking was contracted, officiallyputting to an end the First Opium Combat (Bray, 2001).

Britain`snew settlement thrived as an East-West exchange epicenter and as themoneymaking entrance and dissemination focal point for southernChina. Britain stayed for an extra 99 years in 1898, while rulingHong Kong. Following tons of dialogues in 1984 September, the Britishstate and the mainland contracted a formal treaty which led to theturnover of the island in 1997 for the interchange of the Chineseinitiate to marmalade Hong Kong`s capitalist organization. Hong Kongwas nonbelligerent handed over to China on July 1, 1997. There was abig ceremony attended by prominent leaders especially Chinese,British, and worldwide dignitaries. The leading senior managerheading the new Hong Kong regime, Tung Chee Hwa, articulated astrategy established on the methodology of &quotone country, twosystems,&quot therefore maintaining Hong Kong`s title role as amajor entrepreneurial meeting point in Asia. Hong Kong functioned asthe midpoint of international trade since the first era of theBritish colony. In the unsettled period of the beginning of the 20thcentury, the city`s residents were occupied by immigrants, who mainlycame from the Chinese Republic. A large number of the refugees camewhich aided in the launching of a new responsibility for Hong Kong asa main trade focal point.

HongKong has also been transforming the economy of Mainland China hasexperienced a course of opening up. Hong Kong has become aservice-based nation and also a significant access into the globalbiggest market. Hong Kong has now viewed a monopoly of wealth andsuccess, peace, and around the 1960s and 1970s, a harbor from thedreads of the Cultural Revolution compared to China all through thehistory of their modern city. Hong Kong is a hospitable state. Themetropolitans in the area have welcomed emigrants far away and alsoChina, notably Shanghai. Their friendship has been growing since thecivil war period and the duration of the upsurge of the Communistevent in 1949 (Lee, 2005). Indeed, Hong Kong became the manufacturingport that it once was because of the availability of Chinese migrantswho delivered the pool of skilled and unskilled workforce. It setHong Kong on the trail to economic triumph. In 1970, at PossessionPoint on the Hong Kong Island, the British landing party establishedtheir flag which set in motion an intricate relationship between HongKong and the British government. The political association has lasteduntil the present date.

Afterthe first Opium battle, the Kowloon Peninsula and the new Territorieswere leased from China. The Island of Hong Kong, on the other hand,was conceded in endlessness for the greater part of Hong Kong`sregion. However, it was decided that the original city would bereturned to China, which is its entirety just before the NewTerritories tenancy was due to expire, in 1997. All these changesmade the city face a brain drain, but it happened in the 1980s andthe early 90s when China and Britain had agreed to hand over thesovereignty. In 1989, Hong Kong faced a Tiananmen which maderesidents fear that it meant another evacuation was to happen (Bray,2001).

Chinais organized into four types of administrative divisions from whichthe Central Government devolves power to (Bray, 2001)



•DirectlyGoverned Municipality

•SpecialAdministrative Regions (&quotSAR&quot)


Thecentral government upholds full authority to make appointments to theadministrative branch of the provincial government. The legislativedivision of the provincial government is solely a subset of thenational legislature rather than a separate body. The government isempowered to formulate local laws only and does not have authorityover the appointment of the executive branch.


Theautonomous regions are the same as provinces but have additionallegislative rights which allow the legislature to have more to sayparticularly about the appointment of the executive branch.Traditionally, these are the areas with substantial minorities andtherefore, more powers were delegated to satisfy the minoritypopulace. The rules that affirm the governor must be a member of theinterest group. Conversely, in practice, because there is noseparation of powers amid the executive and the legislature in China,any legislative mistake is purely theoretical. Autonomous regionsfunction in almost the same way as the provinces.

DirectlyGoverned Municipalities

Theseare cities that are big and significant thus, and they are treated asprovinces. Similar to the Provinces, they have limited legislativeauthority.

SpecialAdministrative Regions

Thecentral government in the Chinese constitution has the power to makeSpecial Administrative Regions, as long as they consider it essentialto meet particular standards. There are presently two SpecialAdministrative Regions Hong Kong and Macau, which were bothpreviously European colonies. They were ruled by a mini-constitutioncalled the Basic Law. The Basic Law essentially lays out the verybroad authorities that the central government has contracted tofederalize to Hong Kong and Macau (Lee, 2005).

Unlikethe provinces, mostly all power, apart from defense and some areas offoreign policy, is delegated to the local Hong Kong or Macaugovernment. All in all, as per foreign policy, Hong Kong has a highlevel of freedom. It maintains its passports, its sports team, andtrade agreements. Outstandingly, both Hong Kong and Macau have anactual legislature. The SARs also have their governors that are notdirectly appointed by the Chinese regime but are instead electedlocally to some extent by the rigged election process. By agreeingto decentralize these powers to Hong Kong, the central governmentconstrained its involvement in the day-to-day running of Hong Kong.

Thecentral governments explicitly granted this to Hong Kong under thefundamental law as the segment of the reunification process. Thisgesture gave Hong Kong freedom. The Central Government, in essence,retains the right to amend and interpret the fundamental law as theywant, so they can theoretically take back all of its influences fromHong Kong at any given moment. Therefore, Hong Kong is a SpecialAdministrative Region of China, in common with Macao (Leung and Chan,2003). They are indisputably under Chinese sovereignty, but aremanaged by mini-constitutions which are issued by, and can`t berescinded by the National Peoples` Congress.

HongKong became an SAR of the China government in July 1st, 1997.Inhabitants of Hong Kong are now enjoying a high degree of freedom.Examples of such are holding its capitalist structure, the decree oflaw, independent judiciary, free trade, and right of speech. Britishruled Hong Kong until 1st July 1997. Hong Kong exemplified itsinterests in foreign countries, before the enactment of the Hong KongEconomic and Trade Office Act 1996 which was implemented by theBritish Parliament. It did so via the Hong Kong Economic and TradeOffices and through a distinct office in the British Embassies. Thelatter though terminated soon afterward when the authority of HongKong was reassigned to the inhabitants of Republic of China andbecame an independent organizational region of the People`s Republicof China in 1997 (Leung and Chan, 2003).

Currently,the Hong Kong Trade and Economic Offices are under the management ofGovernment of the Hong Kong Special Administrative Region. Stateslike Canada, Japan, Germany, Australia, the European Union,Singapore, the United Kingdom as well as the United States are theinfluential negotiating Associates of Hong Kong. The offices in thesestates function as the formal descriptive of the Hong Konggovernment. The essential purposes of these posts consist of handlingmatters related to trade and to facilitate employment negotiations,the endorsing of an asset in Hong Kong inter-government relationswith overseas governments and forming networks along with the mediaand business community. Besides, the government of Hong Kong hasestablished offices of Hong Kong Tourism Board republics and regionsto support tourism industry (Lee, 2005).

HongKong is both a distinct country and a part of China. It is a SpecialAdministrative Region of the China Republic initially called the HongKong Special Administrative Region. It has its administration knownas the Government of the Hong Kong Special Administrative Region.Until 1997, Hong Kong was a British Colony. It was hired out toBritain for close to 99 years in 1898. At the end of lease era, thecolony was reverted to China. Perpetually since Hong Kong was handedover to the Chinese regime, there has been turbulence among theislanders concerning governance. China government administrates theregion under the &quotone country, two systems&quot constitutionalprinciple. Then again, the Islanders do not like either the mainlandChinese or the Chinese government.

Therehas been unrest as well as a massive political movement called theUmbrella Revolution, where thousands of university studentsparticipated. As usual, the Chinese government used every meanswithin their power to conquer the campaign as well as any newstalking about it. The Hong Kong citizens consider the mainland peopleas inferior in many ways. Mainland Chinese must acquire a two-waypermit from the Chinese Ministry of Public Security to visit HongKong (Leung and Chan, 2003).

Since1997 when Hong Kong was made part of China under the one country, twosystems approach, the Hong Kong inhabitants have not been comfortablewith the arrangement. For instance, within the administrative range,there is a tendency to focus on one country aspect, within thePro-Beijing camp. There is fear that Hong Kong is slowly integratinginto China because of the policies of backing up the Centralgovernment. What Hong Kong doesn’t consider is that they will bestable and prosper because of this move. Nevertheless, in thePro-democracy camp, the emphasis on the multiple systems methodology,which puts Hong Kong as an element of China, but they must also comeup with more self-governing establishments and upholdself-determinations and human moralities to attain riches as theyco-operate with the Chinese Government.

Therehave been incidents of Mainland station in recent years whereby somesectors of the general public are concerned about the fluctuatingHong Kong environment. It is assumed that the Beijing administrationand its followers in Hong Kong are enthusiastically encouraging theirsystem, from time to time using their power to influence a variety ofcritical decision-making choices within the Hong Kong society.

TheSpecial Administrative Region of Hong Kong Government alsoheadquarters in Beijing. There are three more at Shanghai, Guangzhou,and Chengdu. There is an office of The Central People`s Government ofthe People`s Republic of China in Hong Kong too. The Minister forForeign Affairs has an ambassador bureau in Hong Kong. They makedemanding law enforcement determinations, then, on the other hand,face close encounters in regulating the transportation ofmethamphetamine and heroin to local and markets abroad. Anotherserious problem they face is in the present banking systems whichoffer the channel for currency laundering and also intensifyinghomegrown usage of synthetic drugs, specifically amongst the younggeneration. Hong Kong has its settlement administration and policy.

Thecitizens of Hong Kong and Chinese nationals bear a different type ofpassport. It is known as the Hong Kong Special Administrative RegionPassport. It is dissimilar from that to Peoples Republic of Chinacitizens in Mainland China. Tourists visiting from abroad from nearbyconstituencies who wish not to take part in the waiver program areexpected to ask for travel permits straight from the Department ofHong Kong Immigration (Zhu, 2013).

Politicaland cultural experiences among the people from Hong Kong and Chinadiffer in a big way. It is due to different backgrounds they both hadin history. Hong Kong region was under the British-based imperialstructure from the 1850s to 1997. However, China was ruled by thejurisdiction of the Chinese Socialist Party since 1949 onwards. Theschooling and socialization received by the individuals from the twodifferent areas, the culture and lifestyle were to a large extentdiverse which leads to the cultural clashes. Few of the Hong Kongpersons perceive mainlanders as impolite, ill-mannered, anduneducated. It more leads to natives not accept the Mainlanders,especially when they take a trip to Hong Kong (Zhu, 2013). Travelersfrom China are growing in a remarkable figure which makes theirpresence affect the course of government`s rules. The foundation ofnumerous demonstrations in 2010 was associated with the dispute ofthe particular visit arrangement adversely affecting the day-to-dayroutine of Hong Kong inhabitants. On the contrary, few people fromthe Mainland view Hong Kong citizens as ungrateful and spoiled eventhough they get a lot of economic support from China. It is shockingthat Hong Kong is increasingly regarded as a host for traitors,sycophants of British, and the territory of revolutionaries withinChina.

Cantonese,which is a subgroup language of Mainland China, is spoken by about 80percent of inhabitants in Hong Kong region. There are also otherChinese languages present. They include Teochiu, Hakka, andTaishanese. There has been an increase in population in the areasince its formation as a majestic port, throughout the period ofbeing the manufacturing hub, and up until present role as a globalfinancial region (Zhu, 2013). It has made English to be the preferredlanguage in the tourism sectors, government, and also the business.The traffic signs, announcements in public and also menus inrestaurants are made in English. The existence of multiple dialectsin Hong Kong reflects their extraordinary level tolerating cultures.They have more than one Christian denomination in the area, Mosques,Buddhists, synagogues and also Chinese joss-houses. All this has ledto an entire contemporary culture that is as a result of theexistence of enduring and ancient cultures in society. They haveadopted to change thus creating a right mixture of tradition andmodernization (Mark, 2004).

Thedemarcations between the Hong Kong SAR and the Chinese government arehardly ever forthright. It is due to the multifaceted legal frameworkthat was put in place when the city regressed to Chinese colony in1997. This made Hong Kong an exceptional case, and one which meansthat. China and Hong Kong are always at loggerheads due to wealthdifferences they have. Occasionally, Hong Kong inhabitantsdemonstrate in streets reason being Beijing interfering with HongKong`s political organization and civil matters. Hong Kong has aunique history, therefore, making it the unexceptional case. TheBritish Colonial legacy remains even though former colony wasreturned to Chinese dominion. It has a series of societies andeconomic, ethnic, chronological, legal and lifestyle alterations.Nurturing a sense of togetherness between the two is almostimpossible because of the long centuries they stayed separated.Though the differences can sometimes be seen as superficial, theysometimes explode unexpectedly showing clearly that there is asignificant difference.

HongKong residents are hospitable in nature. People from all the worldvisit the state, and others end becoming citizens there. The regionis well established. They have fully equipped health facilities, goodlearning institutions, big furnished hotels and high-end shoppingmalls. The mainland people living near Hong Kong admire how beautifulthe place has grown to be. After the handover in 1997 where thepolicy of two systems one nation was implemented, some researchersconducted a study in a University. A good number of participants inthe study identified themselves as Hong Kong race rather thanChinese. The study took place in 1996.Seventeen years later anotherstudy took place where the number went. Hong Kong people at no costwant to be associated with the Chinese. They feel as different andunique. In fact, some of them feel ashamed and angry when they arereferred to as Chinese. They have pride for their region for theyhave grown up in the place all their lives (Bray, 2001).

Inthe outside world away from Hong Kong, people admire the region andinvestors find a reason to invest in the state’s economy. They havean important law system which means that cases of theft and fraud areconsiderably small as compared to China. The region is peaceful, andalmost everything runs smoothly. Their economy is stable as well.Many countries have also preferred to have their headquarters in HongKong. The police and the people maintain a smooth relationship. Thelegal system in the location is almost as the one in Britain. Thescheme honors transparency. Their communal party is the one incontrol of Chinas judicial procedures. The Basic Law states that HongKong should uphold their currency which is pegged to the UnitedStates Basic Law, the law that protects the dollar as well as themetropolitan’s capitalist scheme.

China’sflourishing economy is part of Hong Kong’s Influence (Mark, 2004).This was brought about by the existence of the free markets in thecity. It impacted positively on the financial structure of China inthe late 1970s and 1980s. Other parts have also benefited frominvestment, energy, and entrepreneurship of Hong Kong. The economicstatus of China has cultivated in a short period and so has HongKong’s dependence on it. Because Hong Kong is the center fromlogistics and the world`s a gateway to the mainland, it primarilyrelies on the Chinese exportation and manufacturing. Inward tourismand trade also play a significant role in the region`s tax income.Though China does see Hong Kong as part of them, Hong Kong residentstill feels like there is a huge rift between them. Shanghai, being afree craft and financial hub has further led to the deterioration ofthe relationship between the two places (Mark, 2004).

Therehas been an existence of good and working association between themainland and Hong Kong from the time Hong Kong gained its dependence.For a long time after the British left Hong Kong during the OpiumWars, their economy entirely depended on the export trade with theChinese. But that did not last, after 1950, Hong Kong and China tradelinks were cut off due to the rules imposed to China by the UnitedNations. Between 1950 and 1980, the economy of Hong Kong was majorlydwelling on industrialization. It was an advantage to Hong Kong. Theworkforce employed in the manufacturing industry went up by almost 10percent. It moved to 47.8 percent. Then China got an idea theydecided to put in place an open door plan. The model gave rise tofirst shop and back factory strategy. The plan entailed athree-dimensional division of labor which extended to Guangdongprovince. Hong Kong, therefore, decided to change the position oftheir manufacturing facilities and operations to Pearl River Delta.They still retained their labor force who were paid by the Hong KongInvestors in various sectors of the business (Lee, 2005).

HongKong was not left behind either they started creating a protuberantservice focal point. The center specialized in finances, trading,communications, intermediation, transportation, design, andmarketing. This led to an increase in the workforce from 65.8 percentto 76.4 in the years between 1991 and 1997. After the treaty in 1997,the government officials in Hong Kong decided to hold a seminarregarding the economic integration with the mainland China. After awhile the Asian Financial crisis emphasized the significance ofplanning the economy carefully so as to simplify the transition andfacilitate greater trade and industry incorporation. China enteredthe World Trade Organization (WHO) in the year 2001. This resulted inmajor cooperation at the administrative level. Between 1997 and 2001,economic integration and association with mainland China had beenestablished by the region`s business sector. This led to expansionand flow of trade and investment.

Therewas a political change which forced Hong Kong to return to China in1997. However, the change never affected the cross-boundary pecuniaryamalgamation. It couldn’t be compared to the Chinese open doorpolicy. Nevertheless, the front shop and back factory replica of HongKong’s progress went down the gauntlet due to the unpredictableincreasing complexity and growth of the Mainland economy along withexpanded marketable and transport functions (Lo, 2009).

Shoppingis cheaper in Hong Kong compared to China even though Hong Kong isthe richer region. Goods in the Mainland China hold a 20-40 percentVAT tax, whereas assets in Hong Kong don`t. Correspondingly, foralmost all commodities, there is zero tariff on goods entering HongKong and zero charges on property and chattels moving between HongKong and China, though products were directly deploying to Mainlandhave 20-30 percent tariffs. Hong Kong can get away with null taxesfor the reason that the governments land policy is a defect charge.One thing that is serene about comparing different prices indifferent places is that one can clearly see the differences in therate structure. Possessions that are labor and rent sensitive forinstance hotels and restaurants are a lot more costly in Hong Kong ascompared to the Mainland China (Song, 2005).

Italso a good illustration of comparative advantage, given the factthat, it turns out that both the Mainland and the Hong Kongindividuals benefit to going to the other place. Another surprisingfact is that it is much cheaper to get made in China computer partsin the United States than it is in Hong Kong or in the Mainland Chinaitself. The reason for this being the United States to China shippingcosts are zero, whereby the intermediate value is the merchandisingprofit margin, which is higher in Hong Kong because the region has amuch less well-organized distribution system than in the UnitedStates.

Chinais a nation state in the changeover from Socialism, and as a result,there are many syndicates closely associated with governments atdifferent levels. As a result, these companies are used to accomplishmany economic, and social goals of administration and the subsequentinefficiency mean they could not contend in a free market.Subsequently, the relevant governments all have wholesale pricecontrol departments which thoroughly ensure expenses are high enoughto permit inefficient establishments to generate enough revenues tocontinue in survival and sometimes even pay their workforces and lesson a regular basis the local taxes (Lo, 2009).

Thecontinual need to safeguard can be seen in the Chinese central bankretrogressive it`s formerly constant movement to make Chinesecompanies five percent more resourceful every year by steadyappreciations of the currency. Recently the currency was depreciateda standard move but one which only encourages unevenness.Unquestionably the drive to increase salaries annually by ten percenthas predestined a massive squeeze on manufacturing costs so producerswho can turn to robots, whereas those who can`t either shift deeperinto Third World China which is overwhelmed by poor governance, or toother low-wage countries such as Bangladesh and the surroundingcountries.

HongKong gained its economic prominence as a hub of commerce between therest of the realm and a closed off China. During the first days ofChinese economic reform, it also served as a center for financialassets and other expertise. But as China incorporates more closelywith the world, Hong Kong is no longer necessitated as anintermediary. It made Hong Kong`s deterioration inevitable. In theperiod, the Hong Kong tycoons shifted to real estate as their growthengine, bringing about in much higher living expenditures for peoplewho can`t find sophisticated paying jobs. The disappointmentregarding their economic state of affairs is what drove the politicaldissatisfaction.There is nothing that China does politically inHong Kong right now that goes against the Hong Kong`s Basic Law. Theprotesters were requesting for changes to the political organizationboth ahead of schedule, and find a way around by existing procedurefor changing the structure. Then they call the People`s Republic ofChina reneging on promises for not agreeing to that demand (Mark,2004).

EconomicDevelopment has, without a doubt, slowed in Hong Kong from evenbefore the 1997 turnover. The principal executive stereotyped asincompetent by the mass media, and the multitude is restless, ascharacterized by the 2014 protests. As far as attitude and reachingfull potential, Hong Kong is worse off, as its economic growthdeveloped between 2004 and 2011, alongside with the Mainland Chinesefinancial prudence (Somervill, 2016). So as far as we get to knowfrom around1st May 2012, the Hong Kong Correspondents andbusinesses have been mourning the smaller number of Mainland Chinesepurchasers. In September 2015, people lamented that the clothingbecame more expensive than in the recent past, and they related towhat customers demand. The Last time they had such an experienceregarding the prices going unreasonably high was before November1997. Nonetheless, prices dropped and did not grow until after 2004.The people in Hong Kong believe that Hong Kong has been tumbledown byChina because the central government mollycoddled that territory. Theapple-polishing leaders were narrow-minded and lacked courageousinitiatives to lead the economy. Additionally, the price increase inHong Kong is far less than in Beijing or Shanghai, and the food andatmosphere are considerably cleaner than either (Somervill, 2016).

Butcontrariwise, with its growth, the Special Administrative Regionentered developed, prosperous economies drag after 1997, as pointedout earlier commodities prices hiked. In other sources, the blamecannot be put entirely on the People`s Republic of China. The Chinesegovernment wants to render Shanghai the financial capital of China.So, this means that the table is lopsided against Hong Kongcontinuing in that starring role. The People`s Republic of Chinawould be more contented if Hong Kong retired to the second classanchorage it was before 1949. Additionally, the heavy-handedadministration of the People`s Republic of China does nothing to winthe trustworthiness of the Hong Kong general public, treating themlike subjugated people rather than welcome returnees to China, takingalong their individual and unique proficiencies.

Theother blame is in the Hong Kong region itself. In continuing hubris,they refuse to acknowledge the fact declared above. They are indisagreement with their largest customer base, mainlanders. They areslow by slow losing English capability and obstinately avoiding theuse of Mandarin. As a result, they have been deserted by theiroligarchies. Hong Kong has been allocated a hand, one which theycannot change. Success in life is influenced by not in getting a goodhand, but rather in how one tackles the hand you are dealt. Hong Kongis one of the most exceptional and charming cities in the biosphere(Bray, 2001). Though is it still not as it used to be, it stillattracts tourists and businesses because of its uniquecharacteristics. As time goes on, we hope the Hong Kong focuses onthat and stay what it is.

HongKong was one of the most important channels for mainland China tolink outside world back before 1078. Hong Kong was benefited a lot byserving a similar role as Singapore. After 1978, China opened itsgate, and other ports in the Chinese Republic started to become moresignificant. It is right to say, that the Hong Kong`s destination wasset already once China opened other seaports. China had to open morehavens to develop itself better economic wise. Therefore that ruin inHong Kong is inevitable, no matter under which republic`s sovereign.In fact, Hong Kong was doomed to crash during the 1997 FinancialCrisis in Asia. It was mainland China`s government, even thoughmoderately based on some politically aware needs, which supportedHong Kong and got it through that predicament (Bray, 2001).

Underthe British rule, the Hong Kong and its educational system wereresolutely in the western camp. So, for the era of the years between1984 and 1997, the people of Hong Kong were persuaded that they werecollectively missed. Some of them decided to relocate to Australia,Canada, the United Kingdom, New Zealand, and the United States. In1989 the situation went from bad to worse (Lo, 2009). The people ofHong Kong were convinced that the student protest march would lead toa democratic China, which was why the demonstration gained so muchsupport. Soon after the gory devastating of the movement, they becameeven depressing in their point of view.

Atthe same time, the wealthy classes in Hong Kong, who were allinvesting in real estate development, finance, and manufacturing,commenced cutting their transactions with Beijing. They wanted to beable to generate money even after 1997, so they wanted a guaranteethat they would be in the right books of their new paymasters. TheChinese government was developing, and they had all that it took todevelop, including the capital which acted as a catalyst in makingthings happen.

TheBritish colony appointed their last British governor of Hong Kong in1993, Chris Patten. Patten was a leading Old-fashioned politician inthe United Kingdom, but after losing his ballot vote, he was givenwhat a lot of people thought would be only a soft job. Patten didn`tsee it that way, when he got to Hong Kong, he had a plan. Thediplomat went around the major power individuals and started talkingto typical Hong Kong inhabitants, acting as a western politicalleader through a campaign. He recommended reforms, especially directelections. The Hong Kong elections were majorly based on its eighteendistricts and functional constituencies. The Functionalconstituencies are established on professions. The whole scheme wasset to avoid direct elections. It is because the British colonydoesn`t prefer democracy. They choose to deal with a native rulingelite who afterward goes off and deals with a large number of people(Lo, 2009).

Patten was undermining the British way of governing things, just asit was coming to the end. On the contrary, Beijing, in fact,preferred the traditional British way of doing business. FromBeijing`s point of view, the whole impression of Chinese choosingtheir leaders in free elections was without question disturbing. Hong Kong began electing their bureaucrats, as well as their ChiefExecutive. The mainland Chinese started wondering if Hong Kong andTaiwan could elect their leaders, why they couldn’t choose theirleaders in China as well. That was a hard argument for Beijing totackle. Beijing worked hard to deprecate Patten`s dogmas and later onHong Kong civil service abandoned him. During 1997, it was clear thatBeijing had won its way. Changes arose since then. Recently in HongKong, there has been an emerging and disturbing case of corruptionwhich has embarrassed the chief executives and Native businessowners. The people, therefore, have chosen to embark on standing upfor their rights rather than being passive and unconcerned withpolitics (Lo, 2009).

HongKong inhabitants hold frequent demonstrations to air theirgrievances, though protests are not legal in China. Another change isthat one of the officials set to become the Hong Kong Chief Executivein 2012 was compelled to resign from the appointment even after beingappointed by Beijing due to a political scandal (Somervill, 2016).Another candidate who emerged from the business was nominated as areplacement. The government officials in Hong Kong look down on theordinary citizens. The cases of these acts have been increasinglyreported. The underprivileged and the low-class individuals areparticularly affected because they can`t afford rent payments. Now,in the appearance of this deep anger in Hong Kong, China has beenforced to make refreshment stand to the people of Hong Kong, as wellas guaranteeing the first direct elections.

Formany years, Hong Kong has functioned as the connection of the worldand China, assigning investment and trade flows in both areas. Chinadecided to unlock its borders and publicize itself directly to theoutside business community. This act reduced the role of Hong Kong asthe bridge. Leaders in Hong Kong feel that the unrest experienced nowin the region will cause Chinese to avoid passing by Hong Kong evenmore. Looking at the magnitude, their statement has some truth in it.Hong Kong has been losing its importance as time goes by (Song,2005). The Gross domestic product has gone down from sixteen percentof mainland’s since1997, which was the year it was reimbursed toChinese domination, up to 3 percent in the present day. Manycountries abroad as well the regions in China have made an assumptionthat Hong Kong is headed towards economic insignificance.

Theemphasis on size alone is too unsophisticated. Growth has spreadaround the country, with Mainland`s growth over twenty years ago, andno single metropolis can dominate Gross domestic product when thereare now approximately two hundred regions holding residents of higherthan one million people and quickly rising salaries. Hong Kong,however, has remained entitled to China in the commercial sector. Itwill be wrong to say that the locus has been eroded which in fact hasjust been amalgamated in recent years. Compared to China, Hong Konghas demonstrated to be more consistent in the financing sector.

Dialogicstated that the Chinese enterprises had made a donation of aboutforty-three billion dollars in preliminary public aids in the HongKong syndicates as from 2012, as compared to just twenty-five billiondollars on mainland exchanges. Hong Kong on the other feels that theyhave done Chinese enterprises a favor by the provision of access tothe global investment markets which enabled them to get financingloans and bonds. They have not received as great help from anywhereelse in the universe. Besides, Hong Kong is the strategic center forthe venture to enter and leave China. The economy in China improvedsignificantly in 2005 because of the directly imported investment(Somervill, 2016).

Companiesfrom overseas also use Hong Kong as staging border marker forinvesting in China which makes Hong Kong make a great fortune out ofthis. It thus makes China town a steady venture surrounding, securedby just understandable courts of law which offer the differentreputable rule of legitimates. It is not only the outside countriesthat find Hong Kong reputable the Chinese government has been usingHong Kong as testing grounds for their monetary reforms. Hong Konghouses the dim sum bond which is a Chinese bun. Yuan currency endedup accumulating profits that were exported. There is a project beingundertaken currently that will allow all the external tradespeople tobuy shares listed in China. This will be done through the Hong Kongstock exchange. Hong Kong gladly and open heartedly hosts the trialfor they know that in the end, they will benefit by being a thrivingfinancial center (Song, 2005).

Internationalbusinesses, the United States being one of them, are increasinglyidentifying the openings Hong Kong offers as a base for providingcommercial and professional services to mainland China. From the timewhen it returned to mainland China in 1997, Hong Kong has obtained areputation as an entryway to China for external venture andbusinesses. The Supervisory Committee of Hong Kong talked about HongKong`s transition role in shaping United States-China economicrelations. The Executive Council converted the influence of China`s&quotOne Country, Two Systems&quot program, which exempts SAR fromimplementing mainland’s socialist system and policies for 50 years,from 1997 up to 1947, on Hong Kong`s title part as a connectionbetween China and the United States. Mainland’s policy offers asignificant degree of sovereignty for Hong Kong, allowing it to applyfull political rights, such as the freedom of expression and theright to participate in elections. It maximizes Hong Kong`s abilityto act as a channel amid the outside world and China (Somervill,2016).

On29th June 2003 the SAR and the Chinese government contracted theconsensual trade agreement, referred to as CEPA, Closer EconomicPartnership Arrangement. This treaty is made up of three sections:tariff cutbacks on 273 classifications of properties exported by HongKong to the Chinese Government the clear breach of the Chinesearcade to Hong Kong amenity benefactors in seventeen sectors and astructure of procedures designed to expediting consensual exchangesof merchandises, investment, and people. Hong Kong and the Mainlandlater signed six annexes to the main agreement. The goal of theseextensions was to clarify and complete the original provisions of theCEPA. Except for a certain number of these measures which wereinstigated in the autumn of 2003, the settlement came into effect on1st January 2004. Both parties have devoted themselves to continuedialogues to extend this agreement to a next platform (Somervill,2016). It is the first agreement to be signed by Hong Kong andmainland China with a member of the World Trade Organization. Thisagreement is the effect of an initiative on the fragment of businesscircles and more predominantly by the Hong Kong General Chamber ofCommerce in response to apprehensions about future of the SAR as agateway concerning China and other regions, which were powered by theeconomic slowdown in 2001. Regardless of its reservations, the HongKong government backed the enterprise and obtained, in December 2001,an agreement in the source from the central government.

WhileHong Kong presently operates as a gateway between the West and Chinain the economic and financial, it could hypothetically play a largerrole by reaching out to educational sectors and research media, TheExecutive Council said. Nonetheless, Hong Kong would then experiencea subtle balancing act in handling sensitive issues, for it does nothave complete political liberation from China. Hong Kong`s politicaland physical geography positions it in a strategic location toconnect economic welfares in China as well as with those in theUnited States and to help China in cultivating its properinfrastructure (Somervill, 2016). However, Hong Kong also requiresdeveloping its competitiveness to uphold its economy sustainably.

HongKong can control its status as an intermediate point between the Eastand the West and attract talent, with an international organizationof students and faculty in its Universities. It enables Hong Kong tocreate positive contributions to China`s legal arrangement. Let`ssay, a combined legal partnership between the United States and Chinathat is aimed at training Chinese judges will aid increase Chineserecognition of the significance of the rule of law, therefore,improving the statutory scheme. The significant presence of mainlandscholars and returning overseas Chinese confirms to the perceivedbenefit of living and working in a more economically and politicallyfree region. In response, the Hong Kong regime has opted to retaintalent by offering mainland students with an extra postgraduate yearto look for employment.

Theupsurge of Shanghai as a salient financial focal point has challengedHong Kong`s competitiveness as a commercial center within the area.Though Hong Kong`s financial sector may not be adequate toaccommodate all of China`s requirements, it still has a relativebenefit compared to Shanghai, due to its particular legitimate andjudicial systems. More so, China`s fast-growing economy requires morethan one financial midpoint. Hong Kong experiences a deficiency ofhighly educated labor, the percentage of its efforts force with aninstitution of higher education diploma is small, at about nineteenpercent. Hong Kong`s universities need to adapt to the fresh marketby training students to work both local and overseas needs,particularly when Hong Kong-based services are becoming more popularin China.

HongKong needs to broaden its horizons regarding economy if it wants tocompete with other big cities in China. It can be made possible bydeveloping high worth services, such as training nautical lawyers andtraining insurance brokers to guarantee smooth legal and financialtransactions. Cultivating the value of its higher education systemwill simplify this transition. An emphasis on scientific research andhigh-technology regions will similarly allow Hong Kong to intensifyits combativeness by exporting proficiency in biochemistry, pharmacy,and engineering to mainland China. The incorporation of Hong Konginto the Chinese economy, principally in the region of Guangdong,will continue to extend with the construction of high-speed trains,additionally as Hong Kong`s increasing dependence on China forelectricity supplies, labor, and water. However, that regionalintegration must take place without negotiating Hong Kong`s autonomy(Bray, 2001).

TheUnited States should carry on supporting Hong Kong by encouragingmaintainable economic development and using it as a threshold totransfer the United States expertise and services to China. TheExecutive Council expressed his confidence that an appreciation ofrenminbi will not uplift the U.S. economy because the economictensions between the two countries are much more problematical than asimple currency adjustment. The ultimate issue, he claimed, lies inthe deteriorating American competitiveness. The economic growth ofHong Kong and China has reduced since the mid-1990s while theeconomic development between China and the surrounding nations hasincreased rapidly (Bray, 2001). In turn, it has affected the economyof Guangdong and other cities. Regarding the gross domestic productHong Kong was overtaken by Guangdong in 2003. With the entry ofChina into the World Trade Organization in 2001, the share of foreigndomestic investment from overseas Countries has escalated drastically(Somervill, 2016).

Chinais now hosting many manufacturing and research facilities from theKorea region, Japan as well as the United States. This has made Chinahave the biggest role of transnational corporations among theserepublics. The 11th Five Year Plan states that Guangdong’sindustrial development will dwell on the locomotion industry,information and electronic industry, petrochemical tools, and alsosteel and manufacturing sector. Guangdong feels that involvingthemselves with Hong Kong will only deteriorate the country’seconomy. This is because the industrialists in Hong Kong have minimalor no experience at all in the (Somervill, 2016). Hong Kong feltchallenged by that. Therefore, they opt to have the most trainedpersonnel and also improve their producer skills. Guangdong, on theother hand, is growing at a fast rate as compared to the surroundingcountries. Day by day, Guangdong is portraying an economic challengeto Hong Kong. The country has majorly invested in exhibition andconvention facilities, airports and seaports. The surrounding townslike Shenzhen, Beijing and Shanghai are developing at an alarminglyfast rate. There have taken over the trade within the region thusmaking Hong Kong weak economically. Shanghai also intends to improveits position as a transnational economy they advance ininfrastructure, upgrade industries, enhance creativity and alsoconserve their environment (Somervill, 2016).

HongKong still wishes that they are going to be prominent in their entireregion of Asia. Nevertheless, they face fierce competition from othercities. It puts Hong Kong in a position where they are no longer thesuperpowers of Asia (Bray, 2001). After all that, Hong Kong stillleads in other areas of the economy like the air- cargo services andglobal monetary activities. It, therefore, shows that Hong Kong stillhas the potential. Sooner or later they will do better than most ofthe surrounding countries to maintain a high profile.


Bray(2001) believes that China has to heavily pay a price as a result ofadopting the one country one state policy. There exists a long-termgoal for China to enhance and advertise an image linking it to beinga law abiding nation. China wants to appear to the world that itpromotes the rule of law and upholds the values of individuals fromboth countries. Additionally, Beijing also faces a major challenge inworking to convince Taiwan to adopt the system. Over the past years,it has been mentioned that Taiwan does not concur with the merits anobjectives of the system. Nevertheless, the success or failure of thesystem depends on how an individual describes things with regards toChina’s purpose.

ForHong Kong’s stability, Bray (2001) says that there have always beenthe sense that China is in a way slicing away the policy in smallpieces that the citizens of Hong Kong are not satisfied. However,there exists a limit to what Hong Kong can do to repel China. Taiwanhas a military force and might use it to re-evaluate its relationshipwith Beijing, and that the repulsion could further worse ties andcause higher anxiety over bigger cross-strait integration.

Itis difficult to nurture a sense of attachment after almost two spansof China and Hong Kong being separate. Linguistically, the commonlanguage of the people is Cantonese. Culturally and socially, HongKong and the China appear to be world apart. Occasionally, thediversities are seemingly minor one significant, showing sample isof an altercation over China tourist centers and what the stand forin terms of their culture. From this, it is eminent that the twocountries still find it challenging to unite under a single policy.For a cohesion to exist between them, both leadership have to come upand enhance social and cultural activities.

Itis evident that the regions have benefited from each other. As muchas Hong Kong is situated far off China in many ways, they areconnected, and they correlate. If one of the regions prospers, inturn, the other one prospers too. They, therefore, should find themiddle ground to coexist so that they can help each otherpolitically, socially and majorly economically.


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