One of the ongoing complaints of Hong Kong citizens who care about preserving their freedoms is how little they were involved in the original negotiations in the 1980s and 1990s, which led to the transfer of Hong Kong from British to Chinese rule in 1997. In the following excerpt from VIGIL: Hong Kong on the Brink, Jeffrey Wasserstrom recounts those negotiations.  

The irony of the UK, one of the world’s great democracies, belatedly handing over a colonized people from one distant ruler to another, in Beijing, was not lost on the people living nearly 2,000km south of China’s capital.

It is hard to say how genuine Margaret Thatcher’s claimed optimism at the time about China’s liberalization was; turning a blind eye to the killings in Beijing in 1989 certainly seems like a neck-craning effort. 

But as Wasserstrom points out in Vigil, many people making predictions about the future of China and Hong Kong have been proved wrong. 

In 2014, older protestors had urged caution in the Umbrella Movement. By 2020, the world’s eyes seem to be at least a partial check on mass bloodshed in the PRC (although the Hong Kong protests have still been met with brutality). Still, despite the shadow of Tiananmen Square, a repeat massacre has not yet happened in Hong Kong.

More negotiations are to come. With more of Hong Kong’s people than ever before calling for universal suffrage, the promise of Hong Kong’s autonomy being preserved only until 2047 now seems arbitrary. 

But the looming deadline outlined in the Joint Declaration still provides a touchpoint for discussions about Hong Kong’s future. As a result, the negotiations that resulted in the Joint Declaration still matter. 

One topic of contention is whether or not Hong Kong citizens born before 1997 should be granted the right to live in the UK. The UK government has said that extending resettlement rights to British National (Overseas) passport holders (the travel document available to Hong Kong citizens under British rule) would be in violation of the Joint Declaration. 

In February, Lord Goldsmith, the former Attorney General who wrote the citizenship review which the government’s decision is based on, wrote to the Home Secretary Priti Patel to say that his review had been misrepresented – BN(O) passport holders can legally be given the right to live in the UK. 

The negotiations continue, with the freedom of a city-state in flux, and the future of Hong Kong in the balance.

Until the end of World War II, Hong Kong was in the shadow of Shanghai in most regards. Soon after the 1945 Japanese surrender, though, they reversed positions. This was the result of, first, the threat of the Communist Party’s conquest of Shanghai, and then the reality of Communist rule sending people, from fashion designers and filmmakers to merchants and mobsters, fleeing south to a capitalist and colonial Hong Kong. During the Mao Zedong years (1949–1976), Shanghai became much less like Hong Kong and much less international, shedding most of its ties to Western countries, even as it maintained connections to other parts of the world, especially countries in the Soviet bloc. Shanghai did keep some distinctive reminders of its cosmopolitan past, including the stunning architectural landmarks that line its waterfront Bund. Overall, though, it became much like other mainland cities and less a place that stood apart from them due to its greater connections to the wider world. When in 1923, the Hong Kong and Shanghai Banking Corporation, or HSBC, today the largest bank in Europe, opened its neoclassical Shanghai branch on the Bund, it was the second-largest bank building in the world, and called “the most luxurious building from the Suez Canal to the Bering Strait.” But by 1955, HSBC had shrunk its operations in Shanghai dramatically and was forced to hand over the building to the Communists, who turned it into offices for the municipal authorities.

Shanghai’s fate after 1949 has always provided a model for what could happen to Hong Kong after 1997. Some argued in the mid-1990s that Hong Kong would be left alone by the Communist Party after the Handover due to its economic value, like the proverbial Golden Goose that needed to be coddled so as to continue to lay precious eggs. Yet, Shanghai after falling in 1949 was an example of a Golden Goose that the Communists killed not long after taking control of it (though it is perhaps now more like a Phoenix that has since risen from the ashes and, after decades of recovery, competes with Hong Kong for the title of China’s premier financial hub in many areas, even surpassing it in a few). There were some who insisted in the early days of Communist rule that the fervently anti-colonialist CCP would invade Hong Kong rather than try to broker a transfer of control down the line when the lease of the New Territories ended.

An invasion didn’t happen, of course, and negotiating the future of Hong Kong was exactly what the two sides had to accomplish before the clock ticked midnight. In borrowed space, on borrowed time — that was how Hong Kongers saw their fate. So when it came time to determine the details of the transfer of power, it fell to the British to get a good deal for Hong Kong. After protracted negotiations, Prime Minister Margaret Thatcher and Premier Zhao Ziyang signed the Sino-British Joint Declaration on December 19, 1984, establishing the basic ground rules for the city’s future as an SAR. The agreement stipulated that Hong Kong after 1997 would enjoy “a high degree of autonomy” under “One Country, Two Systems,” and that the Hong Kong way of life would remain largely unchanged for fifty years — setting up 2047 as another expiration date under a new period of borrowed time.

In 1990, the People’s Republic of China adopted a “Basic Law,” derived

from this joint declaration. Since going into effect in 1997, the Basic Law has served as a kind of de facto constitution for the Hong Kong Special Administrative Region. This document stipulated that the “ultimate aim” was to select Hong Kong’s post-Handover governor, to be called “chief executive,” and members of the legislature, called the “Legislative Council” (LegCo, for short), by “universal suffrage.” Unfortunately, nothing is said about how and when this “ultimate aim” would be achieved, and even more controversially, the final “interpretation” of the constitution would be done not by independent Hong Kong courts, but by the Standing Committee of China’s legislature, the National People’s Congress.

The Hong Kong Basic Law was adopted with these general principles in place when Chinese president Yang Shangkun signed the constitution on April 4, 1990. But less than a year earlier, Yang, who initially seemed sympathetic to demands by student protesters in Beijing’s Tiananmen Square, changed course and, along with other senior Communist Party leaders, condemned the demonstrations. His nephew even commanded an army unit during the June Fourth Massacre. With this frightful reminder, Hong Kongers were again asking: Is Hong Kong once more on the brink?

“China will honor the commitments that she has made with us about the future of Hong Kong because I think she’ll wish to be seen to honor them in the forum of the world,” Thatcher told BBC listeners to a call-in show two months after the Basic Law was ratified. Despite a question from one caller about how the events of 1989 would affect her perspective, Thatcher insisted that she still believed China’s economic development would pave the way for democratic reform and that Hong Kong’s freedoms would be safe in the future. Six years had passed since she and paramount leader Deng Xiaoping had worked out their joint agreement, and there had been hope in the West that Deng’s talk of reform and opening ”would lead to a liberalization of not just China’s economy but also its political structures. This hope dissipated dramatically when the People’s Liberation Army carried out the June Fourth Massacre. Deng’s role in that state violence and the related acts of repression (such as the second massacre in Chengdu) that crushed the movement centered at Tiananmen Square engendered considerable doubt in the West about whether he deserved to be seen as a “liberalizer.” This, in turn, sparked skepticism about his willingness to let Hong Kong go its own way for five decades after the Handover.

The events of 1989 also had a profound effect in Hong Kong itself. Even before the shooting started, there had been impressive local efforts to support the protesters at Tiananmen Square, including a benefit concert that helped raise money to buy supplies for activists in the north. (Sir Percy Cradock, Thatcher’s ambassador to China, later said: “I recall that Jiang Zemin took me to the window of the Great Hall of the People, pointed out to the Square and said, there were the tents and they were put up with Hong Kong money.”) The killings triggered a massive June march that was the largest gathering of its kind in the history of colonial Hong Kong. (There was also a big rally in Macau, involving an even larger percentage of that smaller community’s population; an interesting point to remember, given how much more tightly controlled and less prone to protest the former Portuguese colony would be than the former British one once both became Special Administrative Regions in the late 1990s.) Even many local residents who had been looking forward to 1997 as the year when an unjust imperial system would end began to wonder whether they had been too quick to assume that having Hong Kong come under Chinese control would be a good thing if it involved becoming part of a country run by people who had seemed dedicated reformers, but now were revealing hardliner colors. For those in Hong Kong who were already interested in gaining greater democratic rights, the Handover in 1997 was a stain on Britain akin to — although not as deadly as — the way in which China’s reputation had been shattered by the killings in 1989.

But Thatcher claimed that while she was concerned about the brutal repressive moves the Communist Party had carried out the previous year, she remained confident that the promises made in 1984 would be kept. She was convinced — or at least claimed to be convinced — that Deng was a leader whose commitment to economic reform differentiated him sharply from Mao. Despite the setbacks of 1989, she asserted that China was on a general trajectory that would keep making it less and less like the anti-capitalist and chaos-prone country it had been decades before when the mainland was roiled by a Cultural Revolution whose effects spilled over into the colony in the form of Red Guard–inspired and Beijing-backed riots in 1967.

One could argue she was not completely wrong. Initially, little was done to alter Hong Kong’s capitalist economy, and its civil society and legal system remained distinctive. In the long run, though, she was far too sanguine, overestimating how much appearances in the “forum of the world” would matter to Deng’s successors. (He died just before the Handover took place.) She also, perhaps, overestimated how much the “forum of the world” and Britain itself would stay attentive to Hong Kong’s situation in the decades to come.

Thatcher was not alone in being optimistic as the Handover neared. Beijing official publications certainly claimed the same thing. Many businesspeople expected China’s leaders to keep their promises, at least when it came to economic affairs. For example, according to an article titled “A City Bullish on Itself,” which appeared in the March 1997 issue of The Foreign Service Journal,“more than 95 percent of the 663 members” of the local American Chamber of Commerce who responded to a survey chose “favorable” or “very favorable” as their answer to a question asking how they expected the “city’s business environment” to be during the next five years.

There were at least two reasons that China might refrain from meddling too much that had little to do with wishing to be seen by the “forum of the world” as being true to their word. Beijing had touted the “One Country, Two Systems” approach as something that in the future could be applied to Taiwan. Allowing a “high degree of autonomy” to Hong Kong might be helpful, one line of thinking went, in laying the groundwork for Beijing to claim a much bigger territorial prize down the road. Then there was the Golden Goose argument: Gaining prosperous Hong Kong would be an economic boon to China and it would be left largely as it was to ensure it remained an attractive locale for investors and companies.

Then, there were those who were far less optimistic. “Supposedly, Britain’s handover in less than 750 days of Hong Kong, the world’s most aggressively pro-business economy, to China, the world’s largest still officially communist dictatorship, is going to be a non-event,” Louis Kraar, former Asia editor of Fortune, wrote in 1995, in an essay that appeared as the cover story of the international editions of the magazine under the title “The Death of Hong Kong.” “The naked truth about Hong Kong’s future can be summed up in two words: It’s over.” He asserted, for example, that in the immediate wake of the Handover, Hong Kong would become a “captive colony of Beijing, “be transformed into a “global backwater,” and become “just another mainland city” in most ways. The article suggested that there would soon be no more freedom of speech or freedom of the press in Hong Kong than there was across the border in nearby cities such as Guangzhou and Shenzhen.

Kraar was by no means the only Cassandra in the Western media. There were journalists who claimed that even ahead of the Handover the “bill of rights is being emasculated,” and who foresaw a time near on the horizon when “a puppet governor” loyal to Beijing would be “installed,” and insisted the CCP would “abolish the legislature” as soon as the territory became part of China. (Kraar and other journalists were not wrong about the legislature: China, furious that the last governor of Hong Kong, Chris Patten, had “unilaterally” reformed LegCo in 1994 and held full elections for the body in 1995, set up a Provisional Legislative Council in Shenzhen, and after the Handover, it immediately abolished Hong Kong’s LegCo and installed the Provisional one until 1998.)

Thatcher’s optimism has proved problematic. There are many people who now feel that, even though we are well before the proposed 2047 expiration date for the “One Country, Two Systems” framework, Beijing has stopped honoring many of its commitments. However, Kraar’s pessimistic position was also off the mark. The Communist Party exerted a much lighter touch on Hong Kong immediately after the Handover than he predicted it would. In 2007, Fortune devoted a story exclusively to detailing the 1995 commentary’s shortcomings, titled “Oops! Hong Kong is Hardly Dead.” At least economically if not politically, China had “left Hong Kong alone to thrive” under its “One Country, Two Systems pledge.” A variety of other articles have been published over the years that single out “The Death of Hong Kong” as an example of a faulty forecast, making it a rival to Palmerston’s letter as the most oft-cited mistaken prediction about Hong Kong. But Kraar was also not completely wrong, and his biggest mistake, too, was timing — just in the opposite direction from Thatcher’s. Some developments he worried about happening right away would only occur after many years had passed. He was not wrong to worry about elements of the city dying, just about how quickly they would expire.

Jeffrey Wasserstrom is Chancellor’s Professor of History at the University of California, Irvine. His new book is VIGIL: Hong Kong on the Brink (Columbia Global Reports, 2020).

This essay is excerpted from Chapter 2 of VIGIL: Hong Kong on the Brink (New York: Columbia Global Reports, 2020). Amy Hawkins, who writes about foreign affairs for The Economist in London, contributed to the book.

The introduction to this excerpt was written by Amy Hawkins, a contributor to the book. Hawkins writes about foreign affairs for The Economist in London. Until the end of 2019, she was based in Beijing, where she wrote for Foreign Policy, the Guardian, the Times, the Financial Times, the Atlantic and others.