Hong Kong’s Administrative Development in the Postcolonial Period and It’s Changing Relationship with Mainland China

1. Mainland China

Officially known as the People’s Republic of China, this East Asian country is the world’s most populous, with a population of more than 1.4 billion people. China is governed by the Chinese Communist Party, which has jurisdiction over 22 provinces, five autonomous regions, four direct controlled municipalities, and the SARs of both Hong Kong and Macau.

Mainland China has the second-largest economy in the world, at $14.3 trillion, after the United States, at $21.4 trillion.1 China built its economy on heavy industry development, ramping up the country’s industrial and service output over the years. Of late, consumer demand has driven growth. However, after a tougher 2018, in which the nation was embroiled in a trade war with the United States, the Chinese economy grew at its slowest pace in 28 years.2

2. Hong Kong

To understand the root of Hong Kong’s separation from the mainland, one must go back to the Opium Wars between Great Britain and China (1839–1860). During these military and trade clashes, China was forced to cede Hong Kong Island and a part of Kowloon to Great Britain in perpetuity. In 1898, Britain negotiated a major land expansion of the Hong Kong colony and signed a 99-year lease with China. The lease ended in 1997, at which time Britain returned Hong Kong to China as a Special Administrative Region (SAR) called the Hong Kong Special Administrative Region of the People’s Republic of China (HKSAR).3

Under the doctrine of “one country, two systems,” China allowed the former colony to continue to govern itself and maintain many independent systems for a period of 50 years. The Basic Law defines the limited autonomy of Hong Kong.4 Owing to its colonial history, English is one of Hong Kong’s official languages.5

3. Administrative Development of Hong Kong

Administrative development in Hong Kong can be attributed to the dual driving force of political change and economic development. The political economy of administrative development comprises the unique developmental path of Hong Kong, which features a situation of industrialization under prolonged colonial rule and its subsequent handover from one sovereign country to another. To a certain extent, Hong Kong stands out in British (or general) colonial history as the only major colony that has successfully undergone industrialization and then entered the stage of post-industrial society. It is also a rare case of colonialism, in which the path of decolonization did not lead toward independence.6

3.1 Postcolonial Development (1997-present)

On July 1, 1997, 13 years after the signing of the Sino-British joint declaration, 155 years of British colonial rule ended and Hong Kong was returned to China as HKSAR under the arrangements of “one country, two systems.” A high degree of autonomy was formally granted, as the HKSAR government was delegated the authority on all its internal affairs except for Défense and foreign policy. Institutionally, the constitutional design of the Basic Law (the mini-constitution of HKSAR) largely aims to preserve the political, administrative, and economic institutions of the colonial regime, especially the essence of its executive-dominant system and the capitalist system. The intent of the Basic Law drafters was to preserve the executive-led system with senior civil servants remaining the most important pillar of governance. The governor was replaced by the chief executive, who in turn is advised on policy matters by an Executive Council. The chief executive is accountable to the Central People’s Government. The term of the chief executive is for five years, and any person can serve for a maximum of two consecutive terms. Hong Kong also has its own legal and judicial systems (including a proprietary police force), district organizations (with no political power), and public servants, broadly based on the British common law model. However, for land tenure and family matters, Hong Kong reverts to the Chinese customary law model.7 The 60-member legislature is partially democratized, with 30 members currently being returned by universal suffrage. The common law system is largely preserved. At the practical level, the “through-train” arrangement of the civil service was successfully implemented, providing for stability and a smooth transition of sovereignty.

On the other hand, the Asian financial crisis erupted right after the handover of sovereignty and threw Hong Kong into an economic downturn and financial austerity. Ending decades of prolonged economic boom, the crisis brought GDP growth down to –5.3 % in 1998, while the budget deficit went up HK$ 70 billion (5.5 % of the GDP) in 2002. Reviving the economy and reducing the budget deficit became the top policy priorities of the newly established HKSAR government. This economic and fiscal crisis was met with a substantial political crisis, as problems in the executive leadership, successive policy, and administrative failures revealed major deficiencies in the capacity-cum legitimacy of the state and brought the approval rating of the government to an all-time low.8

These economic-cum-political crises revealed deep-seated problems in the political and economic institutions of the postcolonial era. The Asian financial crisis signified the end of the economic miracle and ended decades of continuous economic growth. In a way, it ended the myth of “financial conservatism,” or the myth that low tax rates and high economic growth will continue to support an expansion in public spending on social programs to satisfy the public’s need for adequate public service. The monopoly of policymaking power by the civil servants is increasingly challenged by a civil society of growing strength and a citizenry demanding more public input and accountability in the policy process. In short, the postcolonial state has lost its “performance legitimacy” on both the political and the economic front.

An equally important aspect is the changing relationships between central government and the HKSAR. In the first few years after the handover of sovereignty, central government did adopt a more hands-off policy toward Hong Kong, and understood such non-interference as the essence of “a high degree of autonomy” as promised under the “one country, two systems” arrangement. However, since the worsening governance crisis culminated in the eruption of a mass rally in 2003, central government has taken a more hands-on approach, and has actively intervened in Hong Kong’s political and economic development.9 Instances of political intervention range from offering material support to their preferred candidates in local elections, putting Hong Kong’s democratization on hold, to more serious allegations of plans to set up “a second centre of governance” comprising “local patriotic forces.” Economic intervention ranges from policies to revive Hong Kong’s economy to active measures to promote economic integration between Hong Kong and the regional cities. While some of these measures have helped Hong Kong weather the economic downturn, they have also made the city more dependent on central government if not more susceptible to the latter’s control.

In sum, while democratization is considered necessary to resolve the governance crises adequately for a post-industrial society that has already attained advanced socioeconomic development, the Beijing government has been indefinitely delaying democratization in Hong Kong. A major characteristic of the administrative reforms in this period reflects the attempts of the postcolonial state to deal with these crises’ situations in the absence of democratization.

4. Changing Relationships Between Mainland China and Hong Kong SAR

The establishment of the Hong Kong Special Administrative Region (the Hong Kong SAR) on July 1, 1997 is a political and constitutional milestone in the history of the People’s Republic of China (the PRC). Hong Kong and Macao are granted the policy of “One Country, Two Systems” (OCTS) so that under Chinese sovereignty, the two areas would continue with their capitalist economic and social systems and enjoy “a high degree of autonomy” for 50 years. The OCTS policy constitutes an important experiment of local autonomy in a unitary and socialist state like the PRC.10 Hong Kong’s experience in implementing OCTS since 1997 shows a tortuous path in maintaining autonomy within a unitary Chinese state governed by the Chinese Communist Party (CCP). This chapter is an overview of the changing relations between the central government in Beijing and the Hong Kong SAR since 1997. My overall observation is that the Hong Kong SAR does enjoy a very high degree of autonomy, but its autonomy varies across different domains. Hong Kong’s autonomy is much more evident in socio-economic and external affairs, but its autonomy over political and constitutional matters is much more subject to constraints imposed by the central government. The strategy of the central government toward Hong Kong has also shifted over time.

4.1 Historical Context of the “One Country, Two Systems” Policy

The cession of Hong Kong to the British under the Treaty of Nanjing in 1842 marked not only the beginning of China’s humiliation by western powers with the conclusion of a series of unequal treaties, but also the metamorphosis of this small fishing village into a trading port in south China. When the future of Hong Kong emerged as an issue in the late 1970s, Deng Xiaoping, China’s preeminent leader at that time, proposed the OCTS model as a pragmatic strategy to reunify Taiwan, Hong Kong, and Macao in view of the huge socio-economic gap between Mainland China and these areas at a time when China began to open up and reform its socialist system.

After the Sino-British agreement on Hong Kong’s future was signed in 1984, Hong Kong entered into the transition period. However, the city experienced many more ordeals before re-joining the mainland in 1997, of which the most important was the political crisis in China in spring 1989. Reflecting their anxiety over their future return to the embrace of an authoritarian communist system, many people in Hong Kong sympathized with and actively supported the prodemocracy student movement on the Mainland. The subsequent crackdown in Tiananmen Square soon dashed their hopes and confidence in the promise of OCTS. Beijing also became deeply concerned that Hong Kong could serve as an anti-communist base that could threaten its communist polity. The fall of communism in the former Soviet Union and Eastern Europe further heightened the sense of insecurity among the top Chinese leadership. When the last British Governor, Chris Patten, introduced further democratic electoral reforms in Hong Kong in the mid 1990s, despite prior Sino-British understandings on these arrangements for post-1997 Hong Kong, the Chinese government took a tough stance to cope with what it perceived as attempts by western powers to extend their influence into the territory. For instance, instead of allowing the legislators elected in 1995 to continue their incumbency beyond 1997, Beijing set up its own provisional legislature, an organ that was not provided for in the Basic Law. The confrontational relations between China and Britain in the final years before 1997 over the future political arrangements not only seriously affected Hong Kong’s final phase of political and administrative transition, but also divided the Hong Kong community over its future political development.11

4.2 Hong Kong’s Transformations and Some Challenges of “One Country, Two Systems” Policy under the People’s Republic of China

Now, after two decades of the “One Country, Two Systems” formula actualisation in China’s Hong Kong Special Administrative Region (hereafter HKSAR), and with its fourth Chief Executive Carrie Lam’s maiden Policy Address delivered on 11 October 2017, it is high time for a summary appraisal of post-colonial Hong Kong’s transformations under the sovereignty of the People’s Republic of China (PRC). In the past twenty years since its establishment upon the 1 July 1997 retrocession from British colonial to Chinese sovereignty, the HKSAR has been embroiled in an ongoing and still deepening governance crisis. This, on the one hand, stems from distorted dynamics of HKSAR-PRC mainland interface; and on the other, it intensifies the strains and stresses that have over-shadowed Hong Kong-Beijing relations, with no easy solutions nor uplifting improvement in sight. The most disturbing signal on the current HKSAR scene in the far from harmonious relationship between the PRC central authorities and the HKSAR society at large could be seen in the, deteriorating overall functionally necessary cooperative accommodation and the discernible rise in suspicion, and even mutual distrust, between the Beijing officialdom and a sizable element of Hong Kong community, especially the youth segment. This unhealthy trend is a far cry from the generally optimistic and more self-confident mood that engulfed much of Hong Kong a decade ago, when the then Chief Executive Donald Tsang was on the eve of his second term inauguration.

Another major challenge confronting the HKSAR has been the Beijing officialdom’s assertive re-articulation of the “One Country, Two Systems” formula as being applied to Hong Kong, especially since 2012 when Xi Jinping became top leader of the CCP/PRC while C.Y. Leung took office as HKSAR Chief Executive. Beijing’s continuous and vigorous efforts to elevate the overwhelming pre-eminence of the “one country” element over the increasingly marginalized and subservient “two systems” element in this delicate canter region power equation, with the equilibrium tipped almost entirely in Beijing’s favour. This disequilibrium in the actualization of the “One Country, Two Systems” formula in Hong Kong has given rise to popular, yet not entirely unjustified, outcries against “Mainlandization” among many Hong Kongers. In fact, this widespread perception has become a most obvious and unsettling new development among many Hong Kongers who strongly feel and even deeply resent the increasingly powerful, pervasive and intrusive “Mainlandization’ trends that seem to be engulfing nearly all aspects of Hong Kong’s political life and governance process, including local elections, public policymaking, and above all, regime prosecutorial decisions.

A major bone of contention between Beijing and many Hong Kongers was the pace of democratisation in the Basic Law-framed HKSAR polity. In 2007, Beijing’s Hu-Wen leadership promised direct popular election of the HKSAR chief executive in 2017. Yet, current PRC President/Chinese Communist Party General-Secretary Xi Jinping, who ascended to power in 2012, has been far more assertive on Hong Kong affairs than his predecessors. Viewing Beijing-HKSAR relations as crucial to PRC national interests, state sovereignty, and party-regime security, Xi would not tolerate any dissent or deviation from his version of party-state orthodoxy. The new Xi official line repeatedly emphasized the absolute supremacy of the “one country” over “‘two systems”, the latter supposedly formed the guaranteed constitutional foundation that sustained and empowered Hong Kong’s capitalist and cosmopolitan society, subscribing to many universal core values. Accordingly, the 2014 Beijing-sponsored constitutional reform proposal only allowed universal suffrage in future HKSAR chief executive elections among candidates to be pre-screened by an election committee dominated by pro-Beijing loyalists. It was the belief that Beijing would never allow true universal suffrage in Hong Kong that drove many local youths to participate in the September-December 2014 Umbrella Movement. In a nutshell, that 79-days mass mobilization was a collective protest Beijing’s derailment of HKSAR democratization.

In a real sense, the strained HKSAR-Beijing interface over the chief executive electoral reform for 2017 was a contest of core values and political cultures between the CCP/PRC party-state and Hong Kong’s mainstream quest for genuine democratic reform. 156-year of colonial Hong Kong saw local governance accountable to British parliamentary democracy. Post-1967 (Maoist riots) social engineering and British sunset-era democratization efforts had helped to anchor Hong Kong firmly in Western liberal ethos. The infusion of modern Western values and norms into Hong Kong in large dosages within a short time provoked strong PRC response. The Umbrella Movement is an eruption of local discontents since the 1997 handover. Beijing’s mid-2014 restrictions on HKSAR democratization added pain to Hong Kong people’s sense of helplessness to maintain local autonomy amid increasing economic dependence on mainland China and pressure from the influx of mainland wealth that led to exorbitant property prices and tourists that clogged the streets. This outburst of Hong Kong youth angst is attributed partly to frustrations over dim democratic prospects and deteriorating social justice under a pro-tycoon regime.

As distrust toward the Beijing officialdom intensified, and as HKSAR youth who grew up in the post-1997 era mostly possessed limited knowledge of the PRC (an intellectual deficit partially attributed to local school curriculum’s lack of emphasis on China due to the post-colonial regimes deeply flawed educational reforms), calls for “self-determination” and even outright “independence” from the PRC began to be heard among the younger generation after the Umbrella Movement. Such “localist” sentiments have further strained Beijing-HKSAR relations that witnessed deepening mutual mistrust turned into open hostility and legal-political repression by PRC and HKSAR regime authorities.12


  1. World Bank. “Data: China.” Accessed May. 23, 2021.
  2. World Bank. “Data: United States.” Accessed May. 23, 2021.
  3. Hong Kong Tourism Board. “History.” Accessed May. 25, 2021.
  4. Basic Law. “Chapter I : General Principles.” Accessed May. 25, 2021.
  5. Basic Law. “Welcome Message.” Accessed May. 25, 2021.
  6. Berman, E.M. (Ed.). (2011). Public Administration in Southeast Asia: Thailand, Philippines, Malaysia, Hong Kong, and Macao (1st ed.). Routledge.
  7. https://www.investopedia.com/articles/investing/121814/hong-kong-vs-china-understand-differences.asp
  8. Lee, Eliza W.Y. (1999) “Governing Post-Colonial Hong Kong: Institutional Incongruity, Governance Crisis, and Authoritarianism,” Asian Survey 39 (6): 940–59.
  9. Ching, F. (2009) “How Beijing Plays Its Hand: As Seen from Hong Kong,” Hong Kong Journal No. 15 (July). [http://www.hkjournal.org/archive/072009.htm].
  10. “Towards Federalism in China? Th e Experience of the Hong Kong Special Administrative Region (Cheung, 2007)”.
  11. Berman, Evan. “Public Administration in Southeast Asia: An Overview.” THAILAND, PHILIPPINES, MALAYSIA, HONG KONG, AND MACAO (2011): 1.
  12. Chan, Ming K. “The Challenges of “One Country, Two Systems” Disequilibrium in China’s Hong Kong SAR, 1997–2017.” (2018): 1-9.

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