Hong Kong
Chinese Prime Minister Zhu Rongji met with Hong Kong's Chief
Executive Tung Chee-hwa in November to discuss a stumbling block to
the Communist Party's months-long crackdown on corruption, reported
the South China Morning Post Jan. 31. Zhu raised "grave concern"
that guilty Party members may flee to Hong Kong - a Special
Autonomous Region (SAR) - which does not have an extradition
agreement with the rest of China, to avoid investigations.
Now, the corruption scandal
[ http://www.stratfor.com/asia/specialreports/special106.htm ] has
become a major international news item, potentially dangerous to
China's stability. Beijing must be able to extradite suspects from
Hong Kong, or corrupt officials may disappear en masse - taking
their stolen fortunes with them. Zhu's talk with Tung was likely an
attempt to deal with the problem quietly, to avoid the appearance
of infringing on the island's autonomy. The prime minister is all
too aware that a crackdown on Hong Kong could send investors
fleeing. As well, it could have grim implications for reunification
of Taiwan with China.
When the British handed over Hong Kong in July 1997, China promised
to leave the island's autonomy largely intact, within a "one state,
two systems" framework. The government had to take such a stance to
prevent a large-scale investment exodus. But Beijing's behavior
toward the island over the last several years reflects the obvious:
China's sovereignty takes precedence over Hong Kong's autonomy.
China's relationship with Hong Kong has already been tested. Last
July, Hong Kong's highest court issued a ruling on immigration
[ http://www.stratfor.com/asia/aiuarchive/w990301.htm ] that both
Beijing and the local government disliked. Beijing demanded that
the court alter its decision. The court capitulated, then issued a
statement agreeing on China's right to reinterpret the Basic Law
developed when the island was a British protectorate.
By intervening in Hong Kong's judicial process, Beijing highlighted
the thin veneer of autonomy. A more recent event suggests that the
interference will continue. On Jan. 17, the Chinese government
announced that Xinhua's Hong Kong bureau would no longer double as
the Chinese Communist Party's surveillance unit on the island.
Instead, Beijing now has an official Liaison Office to watch over
the local government.
Now the extradition problem may prompt Beijing to pull rank once
again. The two sides have been negotiating, but as one senior SAR
official pointed out, "there are some fundamental differences to be
resolved," reported the South China Morning Post. But ultimately,
Beijing will persuade the Hong Kong government to accept the
change. The island of 6.2 million - compared to China's 1.2 billion
- will have no choice.
But China must continue to manage relations with Hong Kong very
carefully. The former British crown colony is a litmus test with
which to gauge Beijing's likely behavior in the event of China's
reunification with Taiwan, which also maintains a "one state, two
systems" agreement. If Beijing appears to bully Hong Kong in
blatant disregard of its autonomy, Taiwan's public will become
increasingly nervous. This can only fuel Taiwanese President Lee
Teng-hui's campaign to redefine relations as "state-to-state,"
easing the concept of Taiwan's independence into the political
mainstream.