The Greater China: China, Hong Kong, and Taiwan
After Communist China started to open up to the outside world, its two top trade partners are Hong Kong and Taiwan. The most important reason for this is because of common language--the Chinese language, and common history, up to 1945 in China and Taiwan, and up to 1840 for Hong Kong--taught in all three places. The close trade relationship between the three, the proximity of culture, lead many to mention them as the Greater China--especially now that Hong Kong has become part of China, as a formidable economic, political, and cultural force in East Asia in the 21st century.
Links:
New York Times Coverage of Hong Kong
Hong Kong
1. Hong Kong facts.
Hong Kong has a population of 6 million, with a land area 422 sq mi (compare with Rhode Island, the smallest state of the U.S., which is 1,214 sq mi, with a population of 1 million). The region comprises Hong Kong island, ceded by China in 1842 under the Treaty of Nanjing; Kowloon (Mandarin Jiulong ) peninsula, ceded (with Stonecutters Island) in 1860 under the Beijing Convention; and the New Territories, a mountainous mainland area adjoining Kowloon, which, with Deep Bay on the west and Mirs Bay on the east and some 235 offshore islands, was leased from China in 1898 for 99 years. China regained sovereignty of the colony on July 1, 1997.
Living on borrowed time, the Hong Kongers made their name as the fastest and most efficient workers in the world. With its strategic location, it also developed into one of the world's largest entrepots and financial centers in the second half of the 20th century.
2. Causes for the Hong Kong economic take-off
According to Willem van Kemenade, Hong Kong's rapid economic development in the 1980s and 1990s were thanks to "fate, chance, its colonial rule, and the Communist revolution in China.The more than 6 million Hong Kong Chinese have nevertheless made excellent use of the opportunities offered them since 1949 by China's revolution and regional wars--not by design but by coincidence....Hong Kong owes its success to the unique synergy of flamboyant Chinese opportunism and the rule of law and stability of British colonial 'enlightened despotism.'" Its per capita income in 1997 was higher than England and 40 times that of Communist China. (Willem van Kemenade, China, Hong Kong, Taiwan Inc., The Dynamics of a New Empire (New York: Vintage Books, 1997), p.55.)
First, Hong Kong's economic take-off had much to do with the immigrants from Shanghai during World War II (1937-1945 in China, against Japanese invasion), when many left Shanghai to the British colony of Hong Kong, hoping to avoid Japanese invaders there (although Japan finally caught up with them in Dec.1941; Britain reoccupied the island in Sept., 1945). Many of the immigrants were wealthy and educated. Their wealth and education helped with the industrial development of Hong Kong. Another group of refugees from mainland China during the war, the very poor, served as the factory workers. The British adopted a "laissez-faire" policy toward Hong Kong. It was by no means a democracy. All the top officials were appointed from London. The elective democratic government was a last minute decision by the last British governor Chris patten before Hong Kong was turned over to China in 1997. Nonetheless, it was a society ruled by meticulous laws, which guaranteed the stability of private enterprises and the confidentiality of financial transactions, maintaining Hong Kong's position as one of the world's largest financial centers.
After the Communist takeover of mainland China in 1949, refugees continued to filter through the borders between Hong Kong and China. Of the 6 million Hong Kong residents today, at least 3 million came from mainland China after 1949. These refugees worked extra hard because the job opportunity was often achieved through a risk of life (many refugees swam into Hong Kong across from Guangdong Province of China). They seldom complained and hardly expressed any form of protest politically. They proved to be a valuable work force in Hong Kong. Because of the economic blockade of Communist China by most of the capitalist world, China had to buy most of the things it needed from the capitalist world via Hong Kong, providing huge volumes of trade for Hong Kong, contributing directly to its wealth.
After the normalization of diplomatic relations between China and the U.S., informal talks started between Hong Kong and China. Chinese investments started to flow into Hong Kong. Between 1984 and 1997, Deng Xiaoping and Britain held 13 years of diplomatic talks that ultimately decided the terms under which Hong Hong was to return to China after the British lease expired in July 1997. In the agreement, Hong Kong was to remain a capitalist system for another fifty years (called one country, two systems). It was agreed the legal system would remain basically unchanged. Hong Kong would have its own independent court of final appeal. The government would be run by local Hong Kong Chinese, and the head of government --the chief executive--would be appointed by Beijing "after local elections or consultations." Hong Kong's social and economic systems, as well as its lifestyle and personal freedoms, would remain unchanged. Hong Kong would remain a free port, a separate customs territory, and an international financial center with its own convertible currency. (van Kemenade, 68)
3. Hong Kong today.
After Hong Kong's return to China on July 1,1997, things have both changed and remained the same. To a great extent the freedom of the press has been maintained. On the other hand, because of the reliance of Hong Kong government on mainland China, despite their independence the former still voluntarily complied with Beijing's will on many matters. The status of Hong Kong as an international trade center is further compromised by the fact that the majority of Hong Kong investors have their money in mainland China. The influx of Chinese investors into Hong Kong, many of whom children of high Communist cadres with enormous wealth, drove up Hong Kong's real estate over 10 times within 10 years. In 1998, Hong Kong was the victim of a severe economic recession called the "Asian Flu" because it spread through several Asian countries, from Thailand to Japan, South Korea, Hong Kong, Taiwan, Malaysia and Indonesia. One of the reasons for Hong Kong's economic fall was because many mainland Chinese companies that entered the Hong Kong stock exchange were not properly screened and reported more profit than they earned (c.f. Enron in the U.S.). When the truth came out they caused the slide of the Hong Kong stock market. The fall in the stock market also led to the fall of the highly inflated Hong Kong real estate by over 50 per cent. Although Hong Kong economic growth is finally above 0 per cent now (out of negative growth in the past five years), its future as a city of international statue remains uncertain. Its overreliance on mainland China for its source of financial investment, the covert control of Hong Kong politics by the Beijing government, steer Hong Kong away from its former status as international trade and financial center. If Hong Kong is to be reduced to just a Chinese city, it is not in a position to compete with some other Chinese cities such as Shanghai, not only because of its geographical location (the very south of China while Shanghai is at the center), historical reasons (Shanghai has always been the number 1 city in modern China), and human resources (Shanghai people are generally more highly educated than people in Hong Kong), but also the network established between Shanghai and nearby regions/cities in industrial production and commercial marketing, a network that Hong Kong does not have with its northern neighbors in China. Hong Kong may still remain a solid middle class city of light industry, significant trade and sea port, a status that may be guaranteed by the legacy of the British political system and established commercial foundations. Many predict Shanghai is going to overtake Hong Kong as the top Chinese international city.
Taiwan
1.Taiwan facts:
1995 est. pop. 21,501,000, size: 13,885 sq mi (35,961 sq km), in the Pacific Ocean, separated from the mainland of S China by the 100-mi-wide (161-km) Taiwan Strait. Compared with the state of Texas, which is 267,338 sq mi (692,405 sq km). Pop. (2000) 20,851,820. Taiwan has about the same population of Texas, with half the size.
2. Taiwan history:
Historically, Taiwan was populated by Chinese immigrants from southern China, and native Taiwanese of largely Malay origin. In the 1600s, Taiwan was briefly colonized first by the Portuguese (who named it Formosa) and then the Dutch. A Chinese general cleared the Dutch out of Taiwan in late 17th century and Chinese government started to establish offices in Taiwan some time later. In 1895, Taiwan became a Japanese colony and remained so till 1945. Japan's colonizing policy included mandatory Japanese language in all Taiwan schools. Nationalist troops of China took over Taiwan following the end of World War II, and by late 1948, the failure of the Nationalist government in the Chinese civil war with the Communists led to their retreat to Taiwan. In the 1950s, Taiwan and the U.S. drew more closely together because of the Korean War, when Communist China participated on the side of the north Koreans against South Korea and the U.S.
From the 1970s, Taiwan gradually developed an export oriented economy, and transformed itself from assembling products for the U.S. and Europe to a production center on its own, making computers, chips, and many other goods that require great technological sophistication.
Up to 1978, Taiwan leaders were from mainland China and their eventual goal was to recover China from the Communist government. Starting from 1988, Taiwan was ruled by a Taiwan born president for the first time whose ties with mainland China were very remote. As Taiwan became more and more governed by the natives, and as it becomes a more affluent region, more Taiwanese aspire for the status of an independent state. This was especially accentuated by the diplomatic isolation of Taiwan in the world. After China was admitted to the United Nations in 1972, more and more countries sever their diplomatic ties with Taiwan, and today, Taiwan has formal diplomatic ties with only a dozen small states in the world.
3. Taiwan politics today
Politics in Taiwan underwent a shift from "recovering mainland China" to "Taiwan independence" with the deaths of the Chiang dynasty--Chiang Kai-shek, the Nationalist government leader who had ruled mainland China from 1928-1949 before being defeated by the Communists, and his son Chiang Ching-kuo. The Chiang dynasty rule ended with the death of Chiang Ching-kuo in 1988. After an interim, the first native Taiwan president, though also of the Nationalist Party, Lee Ten-hui (r.1991-2000), launched a new policy. Lee was the son of a native born Taiwanese rice and tea farmer, and after attending an elite colonial high school under Japanese rule (1895-1945), he received a scholarship to continue his studies at Kyoto Imperial University in Japan. In 1951 he went to the U.S. for a graduate study in agronomy at Iowa State University. In 1968, he returned to the U.S. for a Ph.D. in agriculture at Cornell University. (van Kemenade, 107) Lee is said to be more fluent in Japanese than in Chinese. Although not actively pursuing a "Taiwan independence" policy, Lee was preparing the way for such an outcome, first by abolishing Taiwan as a province of China (the title provincial governor thus was abolished), and then by establishing a democratic elective procedure in 1996: for the first time in its history, Taiwan held a primary election for its president, though Lee was reelected. The democratic election wsas to pave the way for future independence--through claiming that Taiwan has a sound political system as a country.
In 2000, the second native Taiwan president elect, Chen Shuibian, continues a policy of Taiwan independence. He has suggested a change of the country name of Taiwan from "Republic of China" to "Taiwan," meaning Taiwan is not part of China. He has also passed into law the use of public referendum--something that may eventually be used by the Taiwan people to decide if they want to reunify with China or declare outright independence. But this policy has met with many obstacles since Taiwan economy is in recession, and Taiwan has become the largest foreign business investor in mainland China. The close economic ties between Taiwan and China make many Taiwanese fear that independence would mean military retaliation from mainland China, which they do not want to see happen. In March 2004, Taiwan will have its next presidential election. So far (June 2003), several political parties are participating, and over 50 per cent of Taiwan public opinion express they could consider reunification with China, and 30 per cent says they want Taiwan independence. Whether Taiwan should be independent or continue a dialogue with China about possible reunification in the future is going to be on top of the agenda of every presidential candidate.
Taiwan has many concerns with unifying with China. The two are under two different political systems, and over the past fifty years have developed along very different paths, although their cultural background remains extremely close and their business connections are just as close. The Asian Flu of 1998 struck Taiwan hard, shifting many Taiwan businesses to China, especially the Shanghai area. The recent outbreak of the SARS virus has been another blow to Taiwan's tottering economy. Meanwhile, Taiwan leaders fear that if they agreed to unification with Beijing at this point, they will be in a weaker bargaining position than Hong Kong. The "one country, two systems" style of unification between Beijing and Hong Kong has not turned out most successfully for Taiwan, and if it is to go through a unification, it wants Beijing and Taipei to be equal political partners. While Hong Kong had no choice because it was a British colony and to many Hong Kong people, it was better to be ruled by Beijing, which was, after all, China, than to be ruled by the racially discriminating British. But Taiwan felt itself a sovereign state, thus it has more choices. Historical reasons have led the U.S. to consistently side with Taiwan while subtly nudging the two sides not to go to war. The future of Taiwan's political status depends on many factors. Eventual unification with China may happen in 20-30 years, but the terms of unification may very much depend on what China, and Taiwan, are like then.
