Hong Kong: what’s happened in the 25 years since Britain’s handover to China?

Since the UK returned its colony to China, the city has changed beyond recognition

Fireworks light up Hong Kong's harbour
Fireworks light up Hong Kong’s Victoria Harbour to mark the British withdrawal from the territory on 30 June 1997
(Image credit: Ricky Chung/AFP via Getty Images)

The Hong Kong handover ceremony began on the rain-soaked evening of 30 June 1997, after a banquet for 4,000 dignitaries.Chris Patten, the 28th and final British governor of Hong Kong, addressed the crowd. “No dependent territory has been left more prosperous,” Patten declared, “none with such a rich texture and fabric of civil society – professions, churches, newspapers, charities.”

He ended his speech by stating: “Now Hong Kong people are to run Hong Kong. That is the promise and that is the unshakeable destiny.” Prince Charles read a farewell speech. Just before midnight, God Save the Queen played out a final time. The Union Jack was lowered; the Chinese flag and the new Hong Kong banner were raised.

Less than an hour later, the royal yacht Britannia slipped its moorings, carrying Prince Charles and Patten out of Victoria Harbour. Patten cried.

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Why had Hong Kong become so prosperous?

When the British first occupied it in the 1840s, Hong Kong was a barren, nearly uninhabited rock with an excellent natural harbour. (Hong Kong means “fragrant harbour”.) During 156 years as a British colony (interrupted by Japanese wartime occupation) it became a mercantile hub, hosting the great British trading houses.

Communist victory in 1949 meant that it lost the Chinese trade, but gained almost two million refugees and exploited other trading and financial opportunities in southeast Asia’s growing economy. It became “Asia’s world city”, flourishing because it offered stable government, the rule of law, low taxes, and little red tape.

It also had a free press; but it was never a democracy. It was ruled by the governor, advised by a Legislative Council made up of UK officials, merchants and prominent citizens. By 1997, it had a population of 6.5 million, a per-capita income higher than the UK’s, and accounted for the equivalent of 18% of China’s GDP.

Why did Britain return it?

Because a lease expired. China ceded Hong Kong Island to Britain in 1842 at the Treaty of Nanking, after defeat in the First Opium War; and Kowloon, the peninsula opposite Hong Kong, after the Second Opium War, 18 years later.

In 1898, Britain also leased the New Territories – the mainland area beyond Kowloon – for 99 years. Britain pressured the ailing Qing dynasty into the deal, and paid nothing.

Claude MacDonald, the British negotiator, chose 99 years because he thought it “as good as forever”. As the end approached, Britain proposed retaining Hong Kong and renewing the New Territories lease; or preparing it for independence. But China’s leaders weren’t having it. They disavowed the “unequal treaties” made during the “century of humiliation”.

In 1984, the Sino-British Joint Declaration, under which Britain would withdraw from all Hong Kong in 1997, was signed.

What were the terms of the deal?

China agreed to govern Hong Kong under the principle of “one country, two systems”, pledging a “high degree of autonomy” and civic freedoms for at least 50 years. Hong Kong became a “Special Administrative Region” of China, with its own legal system, political parties, and rights including freedom of assembly and free speech.

These rights were enshrined in a mini-constitution, the city’s “Basic Law”. Beijing’s role was to be limited to defence and foreign affairs. Residents would be allowed to elect about half the Legislative Council, and the “ultimate aim” was to elect the territory’s leader “by universal suffrage” (though no deadline was given). It was a unique political experiment: could a city with political freedoms survive inside the world’s most powerful authoritarian state?

How did the experiment play out?

In many ways, Hong Kong continued to flourish. Its population climbed to 7.4 million; property prices boomed; it remained a centre of global trade and finance. But it changed profoundly, if slowly.

Many Hongkongers emigrated; more than a million mainland Chinese arrived. Communist Party members were established in positions of influence throughout the city.

Political power was slowly monopolised by Beijing loyalists. Starting soon after the millennium, but accelerating after Xi Jinping became president in 2013, Chinese control was tightened. In 2014, China’s National People’s Congress ruled that candidates for the election of Hong Kong’s chief executive (who leads its Legislative Council) had to come from a Beijing-approved shortlist.

How did Hongkongers respond?

With protests. There were huge protests in 2003 against an (unsuccessful) proposal for an anti-subversion law. The 2014 ruling sparked the so-called Umbrella Movement: pro-democracy demonstrators using umbrellas to shield themselves from police pepper spray occupied parts of the city for 79 days.

In 2019, a bill that would have allowed suspects to be extradited to mainland China led to some of Hong Kong’s largest protests ever. Hundreds of thousands of people stood up against a brutal police response for months. It was ended by the arrival of Covid-19, and Beijing’s imposition of a new national security law, which allows anyone suspected of terrorism, foreign interference or seditious activities to be arrested.

What has its impact been?

Hundreds of people have been arrested under the national security law, most of them pro-democracy activists. The free press has been muzzled: pro-democracy newspapers such as Apple Daily (whose publisher Jimmy Lai has been jailed) have been forced to close.

Protests have all but disappeared from the streets; schools use textbooks that state the province was never a British colony. The new chief executive (the sole approved candidate) is John Lee, a former police chief who oversaw the crackdown on the Umbrella Movement. In many respects, Hong Kong is a Chinese city like any other.

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