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The First Anglo-Chinese, or Opium, War ended in 1842 in total British victory and the cession by China of Hong Kong (several islands totaling 32 square miles on the tip of the Pearl River estuary) to Great Britain in the Treaty of Nanjing (Nanking). Hong Kong prospered and soon needed more room.
Britain acquired the adjoining Kowloon Peninsula (opposite Victoria, the principal island of the colony) from China under the Treaty of Beijing (Peking) in 1860, and in 1898 it leased for 99 years additional land beyond Kowloon, called the New Territory. Britain would rule these 442 square miles of land (except for four years when it was under Japanese occupation between 1941and 1945) until 1997.
Hong Kong was a free port and a hub of international trade in eastern Asia, and it provided refuge for Chinese revolutionaries led by Dr. Sun Yat-sen, father of the Chinese Republic, and those fleeing the civil wars of the early republic.
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After the establishment of the People’s Republic of China (PRC) in 1949 and during the chaos of the Cultural Revolution (1966–76), millions of refugees found opportunities there and a haven from Communist-ruled China.
Because the continuation of a British colony on the China coast offended Chinese nationalism, China demanded Hong Kong’s return. Negotiations between British prime minister Margaret Thatcher and Chinese paramount leader Deng Xiaoping (Teng Hsiaop’ing) culminated in an agreement in 1984 that would restore all the ceded and leased territories to China on June 30, 1997.
The agreement stipulated that Hong Kong would be ruled for 50 years as a Special Administrative Region (SAR) under a Basic Law that allowed it to maintain its own legislature, executive, and judiciary, currency, customs and police forces, flag, and passport. China would be responsible for its defense and foreign policy. Two other significant features of this agreement were:
- Hong Kong would retain its capitalist and free-enterprise system and economic and financial structures;
- The “One Country, Two Systems” arrangement would calm Hong Kong citizens’ fears of communism and perhaps lure the Republic of China on Taiwan to become part of the PRC.
China appointed a prominent local businessman, Tung Chee-hwa, first chief executive of Hong Kong. Tung navigated a difficult path between the aspirations of Hong Kong’s residents for self-government and China’s demand for a final say in all major decisions affecting the SAR.
China always prevailed. For example, in 1999 the Chinese National People’s Congress overruled the Hong Kong Court of Final Appeals on the right of abode for children with one Hong Kong parent.
Tung resigned in 2005, two years before his second term ended, and was replaced by Donald Tsang, a respected high-ranking civil servant who had risen to prominence under British rule. The PRC remained leery of demands for human rights and democracy by Hong Kong’s citizens.
After the opening of China in 1979, a strong economic bond developed between Hong Kong and China. They became each other’s foremost partners in investment and trade, initially limited to adjoining Guangdong (Kwangtung) province, and after 1992 spreading to other centers in China. While China needed Hong Kong’s managerial skills and capital, Hong Kong benefited from China’s deep, cheap labor pool.
The SAR arrangement also applied to the former small Portuguese colony of Macao, but found no acceptance from the people or government of Taiwan. In 2005 Hong Kong had an estimated population of 6.8 million people who enjoyed one of the highest standards of living in Asia.
