Commentary traces why Hong Kong is a city, not city-state

Summary

Key Points

• The commentary says Guangdong and Hong Kong operated for more than a century as one sovereign territory with two systems, from 1842 to 19971
• It argues China never legally transferred sovereignty over Hong Kong to Britain, and cites China’s 1972 move at the United Nations removing Hong Kong from the colonial list1
• The article says Beijing’s post-1949 policy toward Hong Kong was “long-term planning and full use,” while a 1963 Taiwan proposal known as “one outline, four points” became an early strategic template1
• It identifies Deng Xiaoping’s January 1982 formulation of “one country, two systems” and Article 31 of the PRC Constitution in December 1982 as key codifying steps1
• The piece says the 1984 Sino-British Joint Declaration, the 1990 Basic Law and the 1997 handover turned the framework into an operating constitutional system1
• The commentary describes Hong Kong as a distinctive constitutional arrangement within a unitary state, rather than a federation, confederation or colonial transition model.1 It says repeated crises after the handover tested the primacy of “one country,” citing the 1998 Asian financial crisis, the 2003 SARS aftermath, the 2008 global financial crisis, the 2019 unrest and the 2020 pandemic1
• According to the article, Hong Kong used HK$120 billion to enter the market in 1998 with central government support to defend the linked exchange rate.1 After SARS, Beijing signed the Closer Economic Partnership Arrangement and opened the Individual Visit Scheme, with mainland visitor arrivals rising from 8.47 million to 51 million in 2018.1 It also says Hong Kong was among the first regional economies to recover after the 2008 global financial crisis1
• The commentary adds that the 2020 National Security Law was enacted after the 2019 social unrest, while the central authorities also provided vaccines, anti-epidemic supplies and nucleic acid testing support during the Covid-19 pandemic.1 It acknowledges social costs linked to each intervention, including debate over state shareholding after the 1998 market operation, inflation and parallel-trading tensions linked to tourism growth, and some multinational firms adjusting regional business layouts after the security law took effect1
• On economic and institutional benefits, the article says CEPA allows zero-tariff entry for Hong Kong-made goods into the mainland, while Stock Connect and Bond Connect have linked the two financial markets, with cumulative turnover through Shanghai and Shenzhen-Hong Kong Stock Connect exceeding RMB100 trillion.1 It says Hong Kong handles about 70% of global offshore renminbi payment flows, and that Hong Kong passports offer visa-free access to nearly 170 countries and territories1
• The piece further argues that Hong Kong’s common law judgments can be enforced in the mainland, while local arbitral awards can be recognized in more than 170 countries.1 It says residents can live, work, seek medical care and retire in the Greater Bay Area while retaining common law property protections and free capital movement in Hong Kong.1 It also cites access for Hong Kong students to more than 300 mainland universities and notes that salaries tax in Hong Kong tops out at 17%, with double-tax relief arrangements available for Hong Kong people working in the Greater Bay Area1
• In contrasting Hong Kong with Singapore, the commentary says Singapore’s military, diplomatic and currency powers derive from its own sovereignty, while Hong Kong’s autonomy comes from powers granted by the central authorities through the Basic Law.1 It argues that Hong Kong’s reliance on mainland backing in major crises shows it is not a self-sufficient city-state1

Why It Matters