under the Special Administrative Regime arrangement.

In the past and at

present, the British Administration, has had to retain a certain

balanced policy towards the Kuomintang and the Communists,

so they have

been able to choose to remain as Kuomintang nationals. Judging from

this worry of the Kuomintang, the PRC's nationality policy towards Hong

Kong Chinese has provided her with another favorable political result,

whether intended or not.

To conclude, in this section we have noted that China's non-

recognition policy is implemented because of various political

considerations. First, this policy is used to back up the fight to

remove unequal treaties; second, this policy is used to retain political

control over the Hong Kong Chinese; and third, to disarm Kuomintang

supporters in Hong Kong. Among the three political purposes, the first

purpose seems to be more basic and important. Hong Kong is the first

territory that was lost to a foreign power under a treaty which the PRC

claimed as unfair and resulting from an unjust war. Being the first

case that led to many other "unequal treaties", the PRC cannot afford to

be seen losing her grip on it. Otherwise, it could have been taken for

granted that the PRC position on this issue can be flexible,

weakening. Secondly, due to the frequent reference of Hong Kong as a

colony, the PRC is prompted to be tough in dealing with this issue.

Ideologically, she cannot afford to lose face in front of Third World

leaders to whom the PRC wants to build up an influential leadership in

competing with the USSR. Thirdly, the termination of a lease on Chinese

territory has provided a most easy case for the PRC to build up her

credit for claiming back a national territory. Fourthly, due to her

willingness to negotiate the issue of decolonization,

Britain

if not,

provided

the PRC a chance for peaceful negotiation, a measure which the PRC can

appreciate in her attempt to keep a friendly neighbouring policy in

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