The present government of the HK Special Administrative Region (HKSAR) is firmly in the hands of the Hong Kong business establishment with full backing from the Chinese government. Its Chief Executive, Tung Chee-hwa, personifies this alliance: his companies, the Tung Shipping Group and Orient Overseas, were saved from collapse in the 1980s through a massive loan from the Bank of China. Tung, however, despite his strong advocacy of “Asian values”, is also an internationalist in his own way: a few years ago he gave a large donation to the British Conservative Party.

His is not an elected government: it has been appointed by China in several stages. The current legislative body, the Provisional Legislature (60 members) was designated on December 21, 1996 by a 400-member Selection Committee which was itself appointed by a Preparatory Committee whose members were in turn appointed by the National People’s Congress (NPC – the Chinese parliament) without any direct input from Hong Kong people. The same Selection Committee also appointed the Chief Executive on December 11, 1996.
The same procedure was followed to designate the Hong Kong deputation to the NPC on December 8: an Election Committee of 424 members nominated by Beijing selected in turn 54 candidates from which it then “elected” the 36 deputies. All but one were already members of the Election Committee. The three members of the Democratic Party who applied for selection failed to secure the minimum of 10 nominators from the 424-member panel to stand as candidates (only three members of the panel were willing to nominate DP members). However, Jiang Enzhu, director of Xinhua, the Chinese press agency which also acted as the unofficial Chinese embassy in the territory before July 1, 1997, and who had been a resident of HK for only four months, is one of the 36 deputies (the only one who was not also a member of the Election Committee).
The Provisional Legislature replaces the Legislative Council which was elected in 1995 by over 1.38 million voters, with a record number of 920,567 people voting in the 20 directly-elected geographical constituencies. In the outgoing Legislative Council, the Democratic Party had emerged as the largest party with 19 seats. The pro-democracy forces (DP and independents) totalled 26 seats and were able to win majority votes on several occasions.
Unsurprisingly, the Provisional Legislature is dominated by conservative, pro-Beijing and pro-business groups. The Democratic Party is not represented (the 26 pro-democracy Legco members refused to recognise its legitimacy and to participate in it); on the other hand, 10 pro-Beijing candidates who lost the 1995 elections are appointed members. The legality and constitutionality of the body is in dispute, and has been challenged by the HK Bar Association.
A new legislature will be elected in May this year. It will again be composed of 60 members, 10 of whom will be designated by an 800-member Election Committee which includes ex-officio members from the National Peoples Congress in Beijing; 30 will be elected by “Functional Constituencies” and 20 by “Geographical Constituencies”. However, the latter will now be elected under a complex proportional representation system rather than by a simple majority, a move intended to ensure the majority representation of the unpopular parties (such as the business elite’s Liberal Party and the Beijing-controlled DAB) at the expense of the more popular independent parties, including the Democratic Party.
The functional constituencies are formed from professions and trades. They already existed in the Legislative Council but under the reforms introduced by the last British governor Chris Patten, the constituencies were broadened to include all working persons, many of whom supported the Democrats. The new functional constituencies will revert back to the old system of corporate voting where the franchise is narrowed down to favour the business elite, with the number of voters slashed by 2.7 million down to 180,000 “functional voters”. Labour is represented by the Beijing-controlled Federation of Trade Unions (FTU) and the Federation of Labour Unions, an FTU ally.
The Executive Council (Tung Chee-hwa’s cabinet) is composed of eleven persons appointed by Beijing, who include the chairman of Inchcape Pacific, the deputy country managing partner of Arthur Andersen (China), the former chairman of the HK Stock Exchange, the managing director of Chase Manhattan (HK) (who has been put in charge of education), the chairman of the HK Federation of Industries, the owner of a property surveying firm (who will be in charge of housing policy) and a leader of the FTU; the remaining members are senior civil servants.
Tung Chee-hwa has also appointed assistants who are part of his inner circle without being formally part of the government. The most powerful is “special adviser” Paul Yip Kwok-wah, owner and CEO of the privately held Renful Group, which has interests in real estate development and manufacturing and has been doing business with China since the 1970s. Yip heads the Hong Kong Policy Research Institute which, among other things, collects information on the activities of human rights groups. Another “senior special assistant”, Andrew Lo Cheung-on, worked for Tung at his shipping firm Orient Overseas. He draws a salary of USD236,000 per year and his duties include maintaining “a regular liaison with the Chief Executive’s constituencies and the Central People’s Government” in Beijing.
On December 16, Tung moved into his new office on the fifth floor of the main wing of the Special Administrative Region Government Headquarters, which is protected by body guards, two police officers and a high-tech array of security devices. A three-meter high steel fence surrounds the building. The cost of decorating and furnishing the offices came to about HKD10 million.