English as an official language, free market economy,

lack of political parties, benign bureaucratic rule,

diplomatic protection by HMG of HK residents when

travelling. Such a list shows that not all of these

elements will change in 1997. So some insulating effect

will remain. A good example is the current debate in

China over the extent of decentralization, especially in

the economy. Such changes in China's own systems are

important, but even quite sharp changes in policy need

not have a lasting effect on Hong Kong's stability or

prosperity. The current campaign against corruption may

worry some, both in China and HK, who have made money in

questionable ways, but so far there is no sign that

measures to remind people of "socialist morality" are

going to mean fingers crushed by the door being slammed

shut.

9.

However, the beneficial effect of some of the changes

in China are clear. The separation of government and

Party functions makes for greater confidence that the

different government structures in Hong Kong will not be

subject to interference by party cadres post 1997.

Greater tolerance of diversity concluding religious

practices in China must make for greater confidence

that Hong Kong's attachment to its freedoms will be

better understood in China.

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