an-illustrated-history-of-hong-kong-nigel-cameron

of Surrender signed in '.:'olcio Bey on 2nd September, 1 945,

on beh.alt of the l:mperor of Japan and the Japanese

Imperial Headquarters, do hereby unconditionally

.surrender ourselves and all forces under our control to Rear Admiral Cecil Halliday Jepson Harcourt , C.3. ,

C.B.E. , and wnertake to carry out all tiuch instructions &II may be given by him or under his authority, and to

issue all necesstiry orders for the purpose of giving effect to all his inistructions.



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Given wner our hand!I this 16th dey ot '�

September, 1 94-5, at Goverrment Houae, Hong Kong. -

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In the presence of



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Ji!Ji-

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On behalf or the Gove._rmi_ ent

or tbe un1t ed lCi.Jlgd.an.



On beh&lt ot the Oomu.nd.er-iD-0:iiet, China. Theatre.



The instrument of surrender. The Japanese signatures remain legible but the British ones have faded.



per cent of his staff had arrived. The result of this shortfall was the employment of Chinese and Portuguese personnel in positions of consider­ ably more responsibility than those to which they could have aspired in pre­ war days. MacDougall paid generous tribute to their performance: 'It can hardly be denied that they thereby established credentials which it would be difficult for any future government to ignore.'7





The Union Jack is raised in the gardens of Government House, signalling the return of British rule.



First priorities included the repatriation of prisoners of war and interne es, the settling of affairs related to the camps, and the demobilization of Hong Kong's armed forces and Auxiliaries. Medically serious cases among those to be repatriated left on the hospital ship Oxfordshire while other groups boarded various liners, a small number going by air. By the end of r94 5 a total of 2, 5 57 pe rsons had departed, leaving only 3 40 remaining temporarily to assist the administration, or occupied with their own affairs. Of all the prisoners from the camps only r20 stayed on in the colony without departing on leave.

During the occupation the Japanese, in an effort to maintain law and order, had given limited police powers to the proprie tors of certain gaming houses and their staff. From a force of 3 21 regular police there were available only 98 officers of the rank of inspector or above, but both Chinese and Indian constables came slowly back to work when it was made clear that their service under the Japanese would not be counted against the m. Most were in poor shape, fit for part-time duties only. Students were then recruited and a Police Training School opened; but the degree of malnutrition to which the police, in common with the popula.ce at large, suffered made training slow. So slow that one local wit described the Police Training School as 'a convalescent home'.

Rehabilitation and Transformation 2 7 r

Ordinary courts were suspended and a Standing Military Court set up in two separate divisions, dealing mainly with criminal cases, the civil aspect of the law being in effect for the time being in abeyance.

It ,vas obvious that the question of the currency would have to be dealt with at once and effectively, and the authorities were forced to recognize the Japanese yen until a supply of dollars could be obtained. Lord Kadoorie, then Mr Lawrence Kadoorie, recalls how in an effort to get back to Hong Kong after wartime internment in Shanghai, he had reached Kunming in Yunnan Province but could go no further because planes were forbidden to take civilian passengers. By a certain amount of guile and with the help of the American army, he ended up in GI uniform, travelling as freight, on a Hong Kong-bound RAF plane, seated on stacks of banknotes - the desperately needed new currency for Hong Kong. 8 This was on r r September. Two days later the Japanese yen were withdrawn and notes of the three note-issuing banks (the Hongkong and Shanghai Banking Corporation, the Chartered Bank of India, Australia, and China, and the Mercantile Bank of India) became legal tender.

The fundamental of Hong Kong life and livelihood - its trade - had somehow to be resuscitated. The intention was for the government to handle all trading for six months and then to hand over to private enterprise; but the eagerness of the Chinese community to resume trading overcame government scruples, and on 23 November private trading was again permitted, although under licence - in order to conserve hard currency. The first ocean-going private freighter entered harbour by mid-December. The process of revival

,vas assisted by the closure of the Shanghai International Settlement, many companies based there moving down to Hong Kong.

Another huge problem was food supply. With one hundred thousand Chinese returning to the colony every month, the plight of the populace in terms of food was both severe and threatening. It was estimated that 80 per cent suffered from some degree of malnutrition. Food shortages were aggravated by scarcity of money to buy what was available. The government itself was responsible for feeding members of the Hong Kong Volunteer Defence Corps and their families, and also for approximately twenty-five thousand destitute persons who ate at government rice kitchens. Those destitute also had somehow to be housed. The solution, as envisaged by the Planning Unit in London, had been to set up a large number of camps. In the event only about ten thousand Chinese destitute were so housed and fed, with the help of charitable societies formed for this purpose.

By the end of 1945 the population figure stood at about r million - 400,000 more than at the end of the occupation - and the situation looked desperate. The Chinese Nationalist Government remained adamant that it would not accept immigration controls, but eventually an agreement was reached under which food was made available to Hong Kong in return for

272 An Illustrated History of Hong Kong

free entry to the colony. In sober fact, the Hong Kong authorities had no means to control immigration at this time. Rice was rationed and restricted to bona fide Hong Kong residents; so too were sugar and flour.

An acute shortage of accommodation prevailed, with 60 per cent of European and 15 per cent of Chinese housing damaged in varying degrees. A landlord and tenant ordinance was introduced to freeze rents at pre-war levels. Such conditions precluded the return of European women and children, which was forbidden for half a year; only men performing essential services were allowed to return.

The rapid population increase, coupled with malnutrition, and poor public health standards due to neglect in the occupation, had lowered the health of the people. The town was infested with rats, tuberculosis was reaching the proportions of a scourge (and remained so for many a year to come); and neither trained personnel nor supplies of any medical mat�rials were due before the following year. Fortunately the water supply system was in fair order, and by mid-Novemb.er supplies stood at 25 million gallons daily. A single daily train plied between Kowloon and the Chinese border by early September and the service to Guangzhou was resumed on 14 November; but

- a sign of the times - the pre-war fare of one dollar now stood at $ 15. 70. The scuttling of many ships in the battle of Hong Kong, together with Allied bombing before liberation, had left 30 wrecks in the harbour and one at Holt's Wharf; and there were tugs and lighters sunk beside piers and quays. Only three wharves were in use and there was not a single workable crane. A committee of Far East shipping companies looked after shipping on behalf of the administration. Public utilities were soon operating on a restricted basis, but lack of suitable fuel and damage to plant limited the electricity generating capacity. Gas, telephone, and tramway services resumed in stages, and the Taikoo Dock and Holt's Wharf returned to private ownership in March 1946. The Hong Kong and Yaumati Ferry Company ran all ferries, the Star Ferry Company having lost all its vessels. In February 1946 these were raised from the harbour and repaired. The first private civilian car arrived in February 1946. Hong Kong island boasted six buses and Kowloon another like number - and lorries with bench seats fitted

became the familiar means of transport for some time.

All the ills of a place that had survived the torture of enemy occupation were manifest in Hong Kong. The bitter recriminations of one group against another, of individuals against fellow citizens about the thorny question of who 'collaborated' (and what constituted 'collaboration') surfaced as they did in France and elsewhere. The psychological wounds of occupation bulked as large as physical injury and malnutrition. Blackmailers and extortionists appeared like leeches, preying on human frailty under duress during the occupation.

With the cost of living by December 1945 still 500 per cent above that of

Rehabilitation and Transformation 2 73

1941, labour unrest took over. Wages had not remotely kept pace with soaring prices. In November a permanent Labour Board issued a table of hourly rates for various grades of workers, offered rehabilitation allowances, and set down a cost of living adjustment pegged to the cost of 10 items of food and fuel. The Nationalists exploited this situation, sending delegations to stimulate unrest, until the Guangdong authorities were asked by Hong Kong to appoint an official to control them. The Communist press, however, showed restraint. The situation was hardly ameliorated when in October the Chinese Nationalists wanted to assemble their forces on Hong Kong soil, to depart on American ships for Manchuria as the Japanese evacuated that area. The suspicion was that the objective was perhaps a more permanent stationing of Nationalist troops in the colony.

The Military Administration continued until May 1946 when the

Governor, Sir Mark Young, returning to Hong Kong on 30 April 1946 - the first Governor to arrive by air - was sworn in the following day. It was a colourful and moving ceremony at Government House as Admiral Har­ court's flag was lowered. In the main hall the 8 3-year-old Sir Robert Hotung read an address of welcome in Cantonese. The hall, indeed the whole structure of Government House, was dramatically different from the place that Sir Mark must have recalled from four years previously, the most prominent alteration being the Japanese-style tower added to what was a greatly changed main building. The Japanese Governor, General Rensuke Isogai, had decided neither to live nor to work there. Instead he chose the Hongkong and Shanghai Bank, living in the chairman's flat on the eighth floor. Later on he moved with his family to a European villa on Repulse Bay Road with a view of the sea. Isogai felt, however, that for reasons of prestige something must be done to rehabilitate the crumbling Government House. To this end he brought a man called S. C. Feltham, the designer of Fanling Lodge, out of Stanley camp. But in the end he settled on a relative, Seichi Fujimura, an architect with the South Manchuria Railway Company. Fujimura produced drawings incorporating Isogai's demand for a structure having something of traditional Japanese architecture, and also symbolizing Japan's military presence, suited to the dignity of later Japanese governors.

In the hall Isogai had placed a life-size wooden samurai in Tokugawa armour and a tiger which had been shot in Stanley in 1942. The animal had

been stuffed by one of the Dairy Farm's butchers taken out of Stanley camp for the purpose. ·(It was supposed at the time that the animal came from Guangdong Province, but more probably it had been freed by its owner, the keeper of a circus performing in Causeway Bay, just prior to the Japanese invasion.)

Sir Mark ,Young arrived equipped with what was styled the Colonial Office's 'new angle of vision', defined in 1943 as the British Government's

intent to guide the colonial peoples on the path to self-government, providing

274 An Illustrated History of Hong Kong

as far as possible the economic and social conditions favourable to its realization. As a first step in Hong Kong, Young legalized the new civil government by passing three ordinances through all their stages in the Legislative Council on 1 May 1946. This done, the Governor turned to his brief, containing its Utopian profession of liberal principles in the conduct of colonial affairs, outlining its application to the affairs of Hong Kong and looking forward to affording residents a greater share in the management of their affairs - 'the fullest account being taken of the views and wishes of the inhabitants' were his words.

Representative bodies were approached and individuals asked to give their opinions. But - and this remained true of the response to such opportunities to speak out until the mid-198os - reactions proved lukewarm. There seemed to be an innate reluctance on the part of Hong Kong people of all stations in life to join in political debate. The mass of the. people seemed content to be governed as they had been, provided always that the government kept its fingers out of the individual's affairs. Some response was, however, received. On this shaky basis the Governor announced his proposals in August. These became known as the 'Young Plan'.

The plan envisaged a 48-member Municipal Council, one-third to be elected by non-Chinese voters and the remainder elected by Chinese and non­ Chinese institutions equally. The Council was to have limited functions in urban areas, while the New Territories would be administered separately. The Legislative Council was to include seven official and eight unofficial members with the Governor having an ex-officio as well as a casting vote - enabling him to hold a balance between the two sides. The new Municipal Council was to nominate two unofficial members, and other institutions four, leaving the existing nominating bodies with one member each as before.

The plan met with a generally favourable reception. In July 1947 it was approved with minor alterations. Sir Mark had by this time left the colony (in May), and it fell to the next Governor to clothe the concept in details, a process which occupied the next two years. In June 1949 three bills embodying the plan made their appearance. It was a sadly belated appearance, doubtless necessitated by the complexity of the details which had to be debated and decided. By that time the concept of what Hong Kong was and might become had begun to alter radically, not from internal pressures but, as so often in the past (and in the future), from the pounding of waves originating outside its shores.

By the middle of 1949 the Guomindang forces had reached the verge of collapse. Hordes of refugees from the mainland were seeking Hong Kong's peaceful little dot of land in ever increasing numbers. And it was in part those refugees, with the business expertise and the manufacturing skills and equipment which some of them brought to the colony, who had begun to change its complexion. On 22 June the Legislative Council debated the issue

Rehabilitation and Transformation 2 75

and a motion was carried delaying the implementation of the Young Plan. The Secretary of State for the Colonies announced in October 19 5 2 that the time for such constitutional changes was not ripe. And there ended the Young Plan, a lone attempt to democratize Hong Kong, relegated to the status of a footnote in the colony's history.

Had the government or the people of the colony at that time possessed the gift of seeing into the future, their excitement would surely have known no bounds. For there, in Hong Kong, in the meeting of those hundreds of thousands of refugees from the horrors of civil war in China, all eager somehow, anyhow, to make for themselves a new life, lay the seeds of the future. In the incubator of the seething territory with its free port, its status as an international entrepot, with a germinating industrial potential, lay an answer as astonishing as any to the opportunities and hazards of the times.

Out of that chaotic era, out of the concerted human will to survive and prosper, out of accidental factors such as a world hunger for consumer goods, and out of the huge influx of human skills and experience, a new Hong Kong was to emerge as much to the surprise of its inhabitants as to that of the world in general. The metamorphosis was traumatic. It was industrially and socially revolutionary within a capitalist framework. It took place more rapidly than any similar process elsewhere in the world.

The Legislative Council, resuscitated in May 1946, consisted of nine

official and seven unofficial members. In 19 5 1 one more unofficial was added and there were then four Chinese and one Portuguese unofficials. By 19 53 there were only two European unofficials. Appointments to the Council were made annually from 195 1, and three-yearly in 195 3. The Executive Council was also revived in 1946, enlarged in May to seven official and four unofficial members. The following year it was revamped and the number of officials and unofficials was made equal with six each, the unofficials being three Chinese, one Portuguese, and two British.

The Urban Council was also revived with five official and six unofficial members, the election of members being indefinitely postponed. This stimulated the birth of the Reform Club in 1949 and the Civic Association in 195 5. In another species of reform, localization in the upper ranks of the civil service was brought out again and the dust accumulated since 1932 brushed off. Posts in the Education, Police, Railway, Medical, and Public Works Departments were opened to local men, the action gaining some strength from the recommendation of the 1947 Salaries Commission that no expatriate should be appointed to a government position if a qualified local person was available. The first Chinese cadet was appointed to an administrative-class post in 194� and a local man attained the position of head of the Medical Department in 19 52. By 1951 over 10 per cent of the administrative and senior professional officers were locally recruited. The 1947 Salaries

276 An Illustrated History of Hong Kong

Commission recommended that a 200 per cent rise in salary be allocated for the lowest grades of civil servant, a 30 per cent increase for those earning

$1,000 a month, and a 20 per cent increase to those on salaries above $1,500 a month.

Within the administration several new departments were set up - Labour

and Mines, Transport, Information, Statistics and Planning, and Social Welfare. Expansion in the judiciary gave that department a Chief Justice, a Senior Puisne Judge, six Puisne Judges, eight District Judges, and rr Magistrates. As important at a later date was the comparatively easy victory of the Hong Kong administration in the long struggle to gain financial autonomy, free now, apart from a consultative obligation, to utilize its revenues in whatever ways it deemed most appropriate. This decision, together with freedom for the administration, was announced by Sir Robert Black in the year of his arrival, r9 5 8. Britain's sovereignty remained but as a general rule was to be exercised only in the control of extern�l relations. The localization policies meant that - to jump ahead a little - by 1971, of the 2, 874 professional and· administrative civil servants, r,609 were local people - a little under 56 per cent. This trend has continued ever since, although not in an even manner.

The Colonial Office was probably not unpleased to leave Hong Kong to

wrestle with its own financial affairs in the immediate post-war period. The colony had a large deficit in London, money spent for war purposes. The estimate of revenue anticipated in the rr months to July r947 was thought to be a little over $ 5r million while the probable expenditure looked like being in the region of $167 million. Tax was raised accordingly on those perennial cash cows, liquor and tobacco, and also on stamp duty, water, meals in restaurants, and on sweepstakes. Government financial pronouncements took on an aura of panic for some time. But, in the face of bankruptcy and to the government's evident surprise, recovery went much faster than anyone could have anticipated. The revenue figure turned out to be higher than had been predicted, at $ 8r million, while expenditure had shrunk to a manage­ able $8 5. 5 million. Hong Kong was showing signs of that intense creative vitality which was later to characterize it.

The vociferous anti-income tax lobby, ever active, was side-stepped in 1947 by a technicality. A tax on personal income was not introduced, but in its place four taxes were announced - on property, profits, interest, and salaries. The Chinese community exploded in an uproar and petitioned the Governor, calling on him personally at Government House, and cabling the Colonial Secretary. Three unofficials of the Legislative Council voted against the budget in the vain hope that direct taxation would not become a permanent feature of the fiscal system. The budgeted surplus for r948-9 was estimated at well over one million dollars - a calculation which turned out to be nothing short of a laughing matter when the actual surplus attained

Rehabilitation and Trans(ormation 2 77

the heady altitude of $ 35 million. The resurgence of the battered colony could scarcely be described as anything less than exuberant.

On 26 February 1946, as if to mark the end of the painful chapter of defeat, occupation, and disruption of life, the Japanese war memorial which had been erected atop Mount Cameron was blown up, watched by large crowds of delighted people.

Sir Alexander Grantham, who succeeded Young in July 1947, had previously served 13 years in Hong Kong as a cadet officer. He knew the colony better than Young and was now to serve 1 o years as Governor - the longest term of any. His concept of what Hong Kong needed in recovering from the war was strong government with a strong emphasis on the laissez­ (aire policies which had been at the heart of its livelihood from the beginning. This was especially pertinent within the general picture of events in surrounding countries. The People's Liberation Army was in control in China, taking the first steps to eradicate the worst evils of the decayed post­ dynastic past; a bitter war raged in Korea in which East and West were heavily involved; and a civil war was in process in lndo-China, another in Malaya, and yet another in Indonesia. Instability, rising nationalism, and the gradual dissolution of exhausted colonial regimes characterized much of the Orient. Hong Kong appeared as almost the only place where no upsurge of dire anti-colonial feeling had yet taken place. The administration, accordingly, thought it prudent to encourage the population in getting on with its business with as little interference as possible. By 1948 it was apparent that this formula was working well. The government had in fact little to offer except a rice supply and a stabilizing influence on prices of food and necessities. Wise for -the moment, it allowed people to find their own ways out of the slough of post-war problems. While the food situation remained fragile, and rationing was much disliked, they were accepted as necessary evils. Piece by piece the food trade was handed back to private enterprise, the last area being the meat trade which, with the continuing shortage of refrigerated shipping, was delayed until July 1957. The Hong Kong government also operated price and exchange control, the dollar being linked to sterling. No attempt was made to control the free market in other currencies.

By all yardsticks the revival of trade was remarkable. In 1946 the volume (excluding officially sponsored cargoes) was 50 per cent of the pre-war volume, and more than double in terms of value (because of the steep rise in costs since the war), China being the largest importer and exporter; 1947 saw exports reach $1,200 million and imports reach over one and a half million dollars. At this point trade began again with Japan. The total trade figure for 1948 leapt to $ 3,659 million, and 1949 saw a 30 per cent rise to $5,068 million. This strong upward trend continued apart from a period during the Korean war when the United Nations imposed an embargo on

278 An Illustrated History of Hong Kong

trading with China, which was supplying Communist North Korea. This caused a temporary slump. As industry expanded in the 1950s the increasing emphasis came to lie with domestic exports and less and less with the old entrepot trade.

Such figures for the expansions of trade and local industry necessarily

involved the banks, whose function in the colony had always been intimately linked to trade. At the time of the Japanese occupation the Hongkong and Shanghai Bank had transferred its head office to London, the move being effected by means of an Order in Council of 13 January 194 3 in which the transfer was back-dated to 16 December 1941. In 1943 Arthur Morse assumed control of the bank under an order of the Colonial Office. At the end of the occupation another Order in Council (20 June 1946) passed all its stages in the legislature in a single session, and made it possible to call an annual general meeting - something that in the absence of epough directors to form a quorum had not been possible since the war. This permitted the general manager to become a director of the bank, and Morse became its Chairman.

Morse was a remarkable banker. With outstanding courage, he envisaged the role of the bank in the revival of Hong Kong's trade as a crucial one, and acted accordingly. Most traders had lost all their stocks, which in effect meant that each had to start from scratch. What was obviously neeeded at once was plant and the materials for reconstruction: equally obvious was the fact that companies could not acquire these until their internal positions were clarified and the situation of each company regularized and legal again. Morse, however, committed the bank to offering advances by opening confirmed credits which guaranteed payments to shippers while in fact, legally, no one but the bank itself could be called into account for the money; an extremely bold, unorthodox move at a time when there was no solid reason to suppose that trade would revive rapidly. Indeed there was scarcely an assurance that the colony would even remain British when Morse made his move.

After the war Hong Kong did its best to maintain a friendly relationship with China - if only for its own sake - dropping pre-war restrictions on immigration, and giving the Chinese Maritime Customs the right to collecting stations in Hong Kong and to patrol its waters. Significant assistance was offered to China in setting up her Gold Yuan currency, and the colony, which at the time could hardly afford the gesture, in 1948 sent 10,000 tons of rice on loan to Shanghai where food shortage was acute. The Japanese had removed the boundary stones marking the border of China and the New Territories, so British officials met their Chinese counterparts to replace them by mutual agreement.

With China's civil war ending, the Guomindang fleeing to Taiwan, and with Communist armies over the border, Hong Kong residents were

Rehabilitation and Transformation 279

understandably nervous. The new ruling force was still an unknown quantity. Britain did the only thing she could in the circumstances to minimize the possible effects on Hong Kong - she recognized the new regime in China in February r 950. This action was not greeted with any particular enthusiasm in Beijing, nor was it followed by many other countries in the near future.

The new situation of the colony of Hong Kong at this juncture, two years into the ro-year term of Grantham's governorship, was evident to all. The turbulent, aggressive events surrounding Hong Kong on all sides took a different and, it seemed at the time, extremely threatening aspect, fired in most cases by the heat of nationalism, a force inimical to the very existence of the colony. But, as if to balance this alarming situation, the first springing of a very energetic industrial growth was plainly visible in Hong Kong; and in the developed world, equally visible, was a hunger for goods of all kinds which the ravages of the war had eliminated or made scarce. Hong Kong had, at least potentially, most of the answers - a vast supply of willing labour, a leavening of skilled, experienced, well-funded Chinese and other industrial­ ists and entrepreneurs ready to equip and re-equip themselves for the production of whatever the world wanted to buy. Hong Kong was a free port, its monetary system was stable, and it held firm to a policy of min­ imal government interference with business. These characteristics, with the enormous enthusiasm of the millions of displaced Chinese eager to make a new and better life for themselves, were to prove the foundation of the remarkable industrial, commercial, financial, and social changes which were to come. The page turned on the past. A new chapter of a qualitatively different nature was beginning.



22. Population, Housing, and Education



IT must be unique in the annals of urban growth for a city to add in the space of just over five years 1 ,760,000 new inhabitants. When Hong Kong was liberated from the Japanese there were no more than 600,000 people left in it; by the end of 19 50 it was estimated that the population stood at 2,360,000. The problems posed were of even greater magnitude.

The source of the metamorphosis which was then about to begin, the

origins of what was to be the driving force, lay in the struggle for power in the civil war in China. The turmoil there, whose massive first statement, the Taiping Rebellion a century earlier, was eventually suppressed, signalled the inevitable demise of the Qing dynasty. The end came through the depredations of the Western powers, and was hastened by Japanese conquest; and clinched by the establishment of an unconvincing republic and by the civil war in which the Communist armies triumphed.

One effect of these terminal throes, an incidental product, was the endowing of Hong Kong at precisely the right moment with the commodity it required - people. From the millions of harried, displaced, destitute people of China, from its threatened industrial elite, and from their skilled and semi-skilled work-force, the colony began to be populated to an extent never previously envisaged. It was no El Dorado, but for them it repres­ ented hope.

As a base for Britain to watch over her Eastern interests Hong Kong had lost relevance - there were no longer any to oversee. The colony now had to be defended for its own sake. Hong Kong, however, was to prove that apart from its defence (its integrity was in the event not at stake) and its foreign affairs, it now had little need of the parent country.

From time immemorial the twin gratifications of making money and achieving success in society have formed the addictive magic of capitalism. Whether it be running a fleet of merchantmen, or selling noodles, money and success are the reward. In this the British and Chinese understood each other

Population, Housing, and Education 281

very well. Napoleon's comment about the English being a nation of shopkeepers could well have been expanded to include the Chinese. In its broadest sense shopkeeping involves nearly all the processes involved in other businesses. In Hong Kong the government had few peasants to contend with. It was a colony of city-dwellers, and the basis, the motive power which in a couple of decades was to transform the colony into one of the twentieth century's economic miracles, resided in the tacit mutual understanding of those Chinese and British shopkeepers on a commercial level. Their contact was seldom intellectual, as it was often enough in India, nor was it straightforward military occupation as in Gibraltar. The common interest was business, the two races completely understanding each other only in this sphere. And within Hong Kong's British society there never existed the acute class distinctions that divided British society in India into the ruling civil service and army elite, and the 'boxwallahs' - those in business and trade. No such stratification was feasible in Hong Kong since the whole raison d'etre of life was 'boxwallah' trading, supervised by a civil service which had no loftier ideas than to do just that. Individual governors and other civil servants from time to time affected to despise the merchants. But they were never the best rulers.

The essentials in the making of the new Hong Kong were the sheer

numbers of Chinese and their ability to work long hours, for themselves or for others, and generally to apply themselves and their families to the fullest extent in the process of making money.

In the appalling conditions in which most of the newly arrived work-force were obliged to live (and often to work), owing to the lack of appropriate available accommodation, the firm government expectation was that when the course of events in China had settled down the flood of humanity would reverse itself and return to China. This proved totally inaccurate. No such movement showed the slightest sign of taking place. On the contrary, the immigrants showed every sign of settling in the colony and making whatever they could of a new way of life in its comparatively stable conditions.

Britain now found herself saddled with a deeper moral commitment to Hong Kong. In response the Labour government in office in 1949 sent 30,000 troops to the colony to avert the slight possibility that the all-conquering Communist armies might attempt to take Hong Kong back to the bosom of the motherland. Had that happened, the government in London would have come under heavy fire in the then impending general election. The force stationed in Hong Kong could not have stemmed a determined Chinese take­ over - there is no certain evidence that such a move was contemplated - and there were difficulties in keeping such a large force in a colony still metaphoricapy licking the wounds inflicted by the Japanese occupation. This was recognized by the Cabinet Defence Committee in 19 5 2, and in April 1954 it was decided to reduce the garrison. The ships of the Royal Navy left

282 An Illustrated History of Hong Kong

for Singapore. In r95 8 the Royal Naval Dockyard closed, and Britain's armed forces in the East shifted to South-east Asia and the defence of Sarawak and Sabah.

Among the major problems facing the Hong Kong government in the late 1950s were, first, housing, and second, education.

The immigrants lived how and where they could. Roof-tops sprouted improvised huts in danger of being blown away in typhoons. Shanty towns grew up on hillsides on the outskirts of the town wherever a trickle of water ran down a ravine, from where it was tapped, collected, and carried to those pitiful shacks for cooking and washing. Ingenious methods of collection were invented, coloured plastic tubes tethered at the source were strung out overhead like some artist's 'happening', to reach individual huts and groups of huts in festoons over the scrub. Sanitation was either absent or primitive, a hazard to public health. But in Hong Kong there was nothing very unusual in that. In town, every stairway in Chinese areas of Victoria and Kowloon had its restless sleepers with their little bundles of possessions clutched to them through the night. Every street where the pavements were wide enough had its clutter of lean-to shelters of cardboard, tar-paper, old corrugated iron, cocooned into some semblance of a dwelling where families were raised, and whose sanitation was the nearest public lavatory - no matter how far away. Not surprisingly the incidence of violent crime rose alarmingly, and by r 9 50 the government was forced to impose a quota for immigrants.



Shek Kip Mei in December r 9 5 3 after the blaze. The homeless return to search in the rubble of their homes.



The first resettlement housing built in Hong Kong was at Shek Kip Mei and housed those made homeless by the I 9 5 3 fire. The photograph was taken in I 9 5 8.



On Christmas Day 19 53 the inevitable happened. The sprawling agglomer­ ation of squatter huts in West Kowloon called Shek Kip Mei caught fire in the evening and, as flames and sparks flew in the cold dry winter air, soon the whole area was a swirling mass of flame - the biggest and most disastrous conflagration in Hong Kong's history. For the people of the ghetto now vanishing in smoke it was a night of terror as 50,000 lost their homes and (most of them) their meagre possessions.

The fire was a disaster which no government could tinker with. There had to be large answers as soon as possible in the shape of housing for the homeless thousands. The remarkable, courageous, and prompt response was the first of the massive rehousing programmes which have continued right up to the present day. The gravity of the situation led rationally to a long hard look at the whole question of housing for the mass of Hong Kong people, a tricky subject only nibbled at in the past. Despite all that had occurred, and all the sanitary and housing ordinances since the black years of plague and fire in the nineteenth-century slum of Taipingshan, house design for the Chinese in the colony had not advanced far. The pre-war population increase between 1937 and 1940 of 500,000 had provoked the construction of some new accommodation, but resulted in more crowding in existing housing and some degree of squatting. But with the massive return of the population after the Japanese defeat and the huge influx as China changed hands, the problem began to take on threatening dimensions. The picture of Hong Kong was by then one of pandemic squatting. Even with new

284 An Illustrated History of Hong Kong

migration virtually arrested in 19 50, the city still had to find room for a natural annual increase of something like one hundred and twenty thousand. Most of this multifarious population (other than squ�tters) was housed in structures whose design, in essentials, had hardly altered since the turn of the century. In these stews - there can hardly be a kinder description of them - generations of Hong Kong Chinese had been born and lived out their lives, sleeping in tiny cubicles in two- and three-tier bunks. An ordinance in 19 5 5 was aimed principally at altering the basic shape of sites for the construction of tenement buildings, permitting access to living units from a corridor instead of through other people's living space. It also stipulated that housing of 10 or more floors must have lifts. The old walk-up government tenements

of anything up to 10 floors now gave way to taller buildings with lifts.

Yet some of the new blocks such as those built at Shek Kip Mei to rehouse those whose homes were lost in the 195 3 fire were little better than the old. A government report of 1963 records:



faced with an initial heavy outlay of key money and with maximum rents, and encouraged by the . . . demand by others for accommodation, the new occupants of premises designed to comply with minimum Buildings Regulations requirements partitioned [them] off into cubicles . . . It was not unknown for 60 to 70 persons to be living in a three-room flat. 1



Many buildings were constructed to nine storeys so as to avoid the regulation which dictated that a 10-storey structure must have a lift.

This was the general type of building, high blocks with lifts, which the government, via the Housing Authority set up in 19 5 4, built after Shek Kip Mei and the 195 5 ordinance. Later developments (growing affluence and new ideas on community housing) resulted in profoundly modified designs as the rehousing programme evolved and became more sophisticated. A new ordinance of 1966 resulted in buildings generally constructed on square sites, entry to each apartment being from a central core containing lifts. The rising expectations accompanying rising incomes forced improvements in style and finish, and such new blocks now offer Western-style apartments in complete and happy contradistinction to the insanitary dormitories of the old tenements.

Hong Kong's record between then and now in housing and rehousing the population is a subject for justifiable pride. If it took a century in coming to pass, at least the results equal or surpass similar schemes elsewhere. The task was, and still is, a colossal one, but the solutions are viable and humane.

In 1961 the government started building another type of housing to cater for lovv-income families living in overcrowded and sub-standard premises. The Housing Authority then began to produce dwellings for families of moderate means living in unfavourable conditions. These schemes all set

Population, Housing, and Education 28 5

a limit on the family income as a means of selecting suitable tenants. An ordinance of 1973 established a new Hong Kong Housing Authority which is responsible for the co-ordination of all aspects of public housing.

In public sector housing by 19 84, rented and owned accommodation housed 2.4 million people, representing more than 44 per cent of the population. Another one million were scheduled to be housed before the end of the decade. The Housing Authority programme is constructed so as to produce 2 15,000 flats over the next few years to 199 1, comprising 15 8,000 public rental flats, 32,000 home ownership flats, and a further 25,ooo flats built for sale under arrangements with private developers in the Private Sector Participation Scheme.

The whole appearance of the New Territories, where most of these schemes are located, has radically altered in the post-war years. Until the early 1960s comparatively little change had taken place. Tai Po was still a large village, Yuen Long a smallish one. It was still possible to drive between the villages of the area (those to which a motor road existed) in rural, even rice-paddy terrain, in which in season the lychee and the lungnan trees were laden with fruit, and where Hakka women in the fields wore their distinctive black­ valanced hats. The fashion among young Chinese for making country excursions in groups was still in its infancy, and the country was quiet and seemingly sparsely peopled. The fishing fleet still went out in junks under sail although most had auxiliary engines. Many country people still wore the traditional sam fu (smock and baggy trousers) of shiny black cotton. Rice­ threshing could still be seen in village squares, and an occasional bride ·was borne to her wedding across the fields "in a red-decorated palanquin, closed except for a small aperture through which her fan-shaded face occasionally peered out, men sounding gongs accompanying the little procession. The two great dams at Plover Cove and High Island were still in the future. The exodus of the younger people from the villages and from isolated islands had already begun, most of them making for Chinese restaurants in England; others to factories in Kowloon. Today there is scarcely a village where the old life continues. Tai Po is a large high-rise town, as are Yuen Long and the formerly charming village of Sha Tin. Others are rising; still more are planned.

In the development of private housing there is a similar story to tell. Several

large new high-rise estates have been built on Hong Kong island, including Taikoo Shing estate and later the Kornhill estate on the eastern part of the north shore. Similar developments are sited on the southern shores and slopes where, in the public sector, some of the earlier housing estates were built. The 100-year-old Dairy Farm at Pok Fu Lam, gradually nibbled away in favour of accommodating people rather than cows, finally closed in its centenary year, milk now coming from a larger farm just over the China border. That waterfall so gratefully used by seafarers in the nineteenth century and before





Sha Tin seen from the hills above the Lower Shing Mun Reservoir in 1961 before the new town was begun.



as a source of pure water, is now overlooked by one of the first public sector housing projects - the towers of Wah Fu estate.

Naturally the southern exposure of the island long ago attracted the more affluent, and such bays as Deep Water, Repulse, and Stanley were colonized in the r92os, their shores dotted with large villas. In 1963, the first high­ rise tower was completed in the centre of Repulse Bay, and today the once verdant slopes all around support a solid, uninviting phalanx of luxury blocks, as do other favoured places. Lantau island has its purpose-built colony of luxury houses and there are several others of large extent in the New Territories.

The industrialization which provided the finance by which Hong Kong's public housing achievements were made possible started, as we have seen, in a fairly unsophisticated manner, with family-run small businesses producing goods urgently in demand post-war. But quite soon the types of manufacture which Hong Kong was called on to produce required the use of increasingly sophisticated plant. While to some extent the workers in such factories did not need to be more than semi-skilled, increasingly large numbers of employees did - in industry, in the supporting banking field, in engineering, statistical, insurance, clerical, and other sectors of the overall picture.



An aerial view of part of the new Sha Tin town in 1987, taken from a point similar to that of the opposite plate. Tall residential blocks are the latest design for resettlement housing.



Generally speaking, adequately qualified applicants have been available as these opportunities arose, and in the right kind of numbers, so it would appear that educational opportunities in Hong Kong have been in the main satisfactory, and have been grasped.

While the first post-war educational policies were directed to the rehabilitation of a shattered system, later efforts had to be directed, reflecting the generally liberal post-war climate of the West, to education of all children to the limit of their capacity to learn. At that time it was not foreseen that, starting in the early r 95os, Hong Kong would metamorphose from entrepot to industrial giant, and vocational training was not then geared to that end. By the end of the Japanese occupation only a few thousand �children were attending school, and the standard of what they were being taught and of the teaching was hardly adequate. Numerous school buildings were in ruins, classroom furniture had long vanished to heat the cooking pots, and what textbooks were available were too expensive for all but a tiny minority of parents to afford.

In Chinese, tradition the road to success in life had always been through education. The existence of the Imperial Civil Service Examinations throughout centuries of history there - contrasting with their introduction in

28 8 An Illustrated History of Hong Kong

Britain only in the nineteenth century - formed the central educational concept in Chinese minds. In Hong Kong the thirst for education manifested itself almost from the beginning of the colony.

By the end of 1946, 52,000 children were attending primary school, but only 1,205 were in secondary schools in urban areas. This compared poorly with the 78, 151 and 14, 109 respectively at the outbreak of hostilities.

Government spending on education in 1947 was nine million dollars, about half devoted to subsidization of schools. This was woefully short of what ,vas required since something like six thousand children were still without education; 1948 saw the opening of a Technical College (derived from the old Trade School), and the Central British School was renamed King George V School, open to all children with an adequate knowledge of English. While primary education revived rapidly, secondary was slower with, in 1948, only two-thirds of the numbers of the pre-war period. Ex­ penditure on education went up to $ 13 million in 1948, yet only just over half of the estimated quarter of a million children were attending school. The system, still prevalent · today, of one school building serving as two primary schools, accommodated in morning and afternoon sessions, resulted from a shortage of school buildings.

Not until 1971 was the goal of free primary education for all those who

wanted it achieved. In that year the total enrolment in all kinds of schools reached 983,495 pupils. A start was made then on enforcing attendance at primary schools. The government began to organize a three-year course of secondary education for all on a fee-paying basis in 197 1.

The 1960s and 1970s saw advances in teacher training, and a curriculum development committee got down to work; the Hong Kong Certificate of Education examination was reorganized to permit greater flexibility in the choice of available subjects, and an educational television service was provided for primary schools and extended to secondary institutions at a later date. The 1974 White Paper stated the ultimate objective of a school place for all children who wanted secondary education, and was in effect a blueprint for educational advance in the following decade. The target was nine years of general education for all by 1979, a goal subsequently brought forward by one year. The White Paper of 1978 had as its major target the provision of subsidized senior secondary places for about 60 per cent of the 15-year-old population in 198 1, set to rise to over 70 per cent in 1986. The education of teachers was further strengthened, and the curriculum further diversified and enriched.

The seventies saw great emphasis placed on balanced development. To achieve this in practical and technical education five technical institutes were built, offering a wide range of disciplines. The Hong Kong Technical College turned into the nucleus of the Hong Kong Polytechnic which, by the begin­ ning of the eighties, offered places to about 26,000 full-time and part-time

Population, Housing, and Education 289

students. A continuous link was established in vocational education through­ out the secondary school system, leading to a technological outlet in tertiary education.

In late 198 1 a Secretary for Education was appointed, thus recognizing the crucial importance of education in the future development of the territory, and in that year a $ 320 million programme was announced, its aim to improve the standard of the English and Chinese languages in schools and in the community at large.

By 198 1 there were over r .4 million children in school in Hong Kong - 2 7 per cent of the population. Offsetting this was a generally held opinion that the slow rise in the numbers of students at the two universities might endanger the future of the territory's economic and social prosperity and development. (It may be noted in passing that about this time, and more insistently after 19 84, the use of the word 'colony', without any official pronouncement on the matter, came to be replaced by the word 'territory', in genuflexion to the coming absorption of Hong Kong into the Chinese state.)

The general educational situation was investigated by a Panel of Visitors

led by a former Director-General of the British Council, Sir John Llewellyn, which carried out a review between April 198 1 and November 198 2. They probed into all the relevant factors affecting education since the war and up to the present. The eventual report, a sympathetic document bearing the marks of a deep understanding of the special conditions in the territory and its struggle for educational facilities, made the point: 'We try to be practical in our commentary . . . We prefer to point to desirable directions [which education might take] rather than to prescribe treatment for immediate ills.' The Panel identified five important areas. It recommended the universal teaching of children in Chinese in the 'formative years accompanied by formal teaching of English as a first foreign language: this would lead progressively to genuine bilingualism in the senior secondary years'. A second recommendation was for improvement in the 'capacity and com­ mitment' of teachers. The criticism was that the language facility of teachers fell short of the recommended bilingual proficiency needed for effective teaching in that context. A third comment stated: 'Examinations dominate the Hong Kong education system, to its detriment.' The Panel pinpointed the need to relieve the strains caused by this and to improve the curriculum by making it 'more relevant to the development needs of the students'. A fourth aspect was the tremendous pressures 'from students, parents, and industry' for variously streamed education, revealing the need for greater diversity of educational opportunities available beyond Form VII, 'so this pressure can be relieved and individuals encouraged to choose from more

varied provisions related more closely to their interests, to the requirements , " of the labour market, and to the community generally'.

290 An Illustrated History of Hong Kong

The Panel's fifth suggestion was :



the need to build up a standing capability to conduct research, to analyse and formulate policy options, and to plan developments. This impinges on the com­

munity, the professions, the bureaucracy, and statutory policy-making bodies. The governance machinery needs to be thoroughly overhauled.2

In due course much of the action recommended by the Panel was included in government policy.

By 19 84 there existed four main types of secondary school - Anglo­ Chinese grammar schools, Chinese middle schools, technical schools, and pre-vocational schools. The first had an enrolment of 375,673 pupils and offered a five-year course leading to the Hong Kong Certificate of Education examination, the medium of instruction being mainly English . Satisfactory results in this examination allowed pupils to enter a two-year course leading to the Advanced Level Examination for admission to Hong Kong University.

The 63 Chinese middle schools accommodated 36, 841 pupils instructed mainly in Chinese, English being a second language.

Secondary technical courses claimed 21,571 students in 22 schools. Qualifying students were then able to continue their studies at the Hong Kong Polytechnic, or the Hong Kong Technical Teachers' College.

Pre-vocational institutions were government-aided secondary schools providing a general education and introducing students to a wide range of technical skills on which future vocational training could be based. In 1984 13 such schools provided 10,039 places.

Three post-secondary colleges were in operation, and various types of special education were available to meet the needs of handicapped children. On the whole, Hong Kong responded well to the requirements of a population whose numbers were rapidly increasing. The growth of a very large and well-to-do Chinese middle class resulted in a commensurate demand for greater sophistication in education, with all that this entailed. There can be few communities in the world whose government and educational authorities have been faced with such an explosion in numbers, in financial clout, and in expectations for their children, in such a short time. The figures speak for themselves: in 1939 there were over 92,000 children in schools of all kinds. In 19 84 the figure had risen to 1, 377,432; this, despite the virtual wiping out of the whole educational system in the

Japanese occupation.

The University of Hong Kong in the post-war years faced a formidable problem in rehabilitation. Loss of staff and equipment was serious, but by good fortune most of its library survived. The Senate had continued to hold meetings in Stanley camp during the occupation, while some of the students had moved to Lingnan University at Gnangzhou where they had continued

TI



T



- �

The fac;ade of the original buildings of Hong Kong University.



their studies - facts recognized in 1946 when the government voted $20,000 towards its rehabilitation; In Hong Kong the decision to reopen the university was made in July 1946, but no official action was taken until March 1948 when the Secretary of State endorsed the need for a university in Hong Kong. In fact the university was already functioning by then. Financial provision, however, was left, once more, to local generosity. Once again the university was 'condemned to that indigence which had dogged its fortunes'3 since it was founded in 1912.

Anticipating the Colonial Office's tardy decision, the university had held matriculation examinations and the first classes began in October 1946 with

109 students of whom 31 were female, in arts, science, medicine, and engineering. This act of faith was to be justified when Sir Robert Hotung donated $ 1 million for the building of a women's hall of residence, and the government granted a capital sum of $4 million, and increased its annual grant to $1 ,500,000.

Pre-war enrolment had stood at 400 students. By 1970 there were 2,28 3, and by 19 84 ,that number had risen to 7,000 studying in nine faculties - arts, architecture, dentistry, education, engineering, law, medicine, science, and social sciences. Competition for places at Hong Kong University, mirroring

292 An Illustrated History of Hong Kong

competition for other educational facilities in Hong Kong was, and still is, intense. In 1984, for the 1,618 places available at Hong Kong University there were 15,ooo applicants. The arguments in favour of a third university seemed compelling.

The Chinese University was formed in 1963 with three autonomous colleges - New Asia College (founded in 1949), Chung Chi College (founded in 195 1), and United College (founded in 1956) - as a self­ governing corporation drawing its income chiefly from government grants. The campus occupies a fine site of 110 hectares on a hilltop near Sha Tin. The university has arts, business administration, science, and social science faculties offering bachelor degrees, and a faculty of medicine runs a five­ year course of two years pre-clinical studies and three of clinical work. Further courses were inaugurated in 1984-5. Both Hong Kong University and the Chinese University offer extra-mural curricula.

The Hong Kong Baptist College, founded in 19 56, runs courses in a similar range of studies. A Vocational Training Council was set up in 1982 to advise on measures to be taken to ensure a comprehensive system of technical education and industrial training suited to the future needs of Hong Kong. By 1984 there were five technical institutes in operation and three more planned, among a growing number of other bodies offering technical education of various kinds. Demand, however, continues mostly to outstrip the facilities for its satisfaction. But the general picture of Hong Kong education is a lively one in almost all spheres, with opportunities for recreational activities being continually upgraded.

2 3 . Growth of an Industrial Giant



WHEN the war in Asia was over two of the basic essentials of Hong Kong's traditional trade - a supply of marketable commodities and adequate shipping to carry them - were both seriously depleted in the Orient and world-wide. Moreover some of the principal items in the entrepot trade such as foodstuffs and textiles were among those in shortest supply and soon to be subjected to international allocation. Acute shortage of food, raw materials, and machinery for manufacturing was partly assuaged by an immediate post­ war reallocation of stocks concentrated by the Japanese in various places in South-east Asia; and it was involvement in this that first brought a demand for the colony's entrepot facilities, and later brought a rapid growth of business, in 1946. The last available pre-war figures ( 1939) show imports at $594.2 million and exports at $533.4 million. The 1946 figures reached

$935.5 and $756.6 million respectively. 1 But the upsurge was not to be

long sustained, and Hong Kong was soon again at the mercy of factors outside her control.

Trade with China, still under the Nationalists, and embroiled in civil war, was conditional on the antiquated process of using armies of coolies to load and unload at her ports (to which she forbade foreign entry). And the position was further complicated by the Chinese trade imbalance of US$412 million in 1945 which made it imperative for her to export more_, and to introduce a system of licensing imports. In 1946 this was done, and categories were established; essentials such as raw materials for industry and manufacturing machinery were allowed entry with little formality, while most consumer goods were prohibited. In Hong Kong this had the effect of arresting the boom of the first nine months of 1946.

One important development was China's decision to export most of her

textiles throy.gh Hong Kong, and it has been suggested that the experience thus gained in the colony may well have helped the growth of Hong Kong's own textile industry in the late 1940s.

294 An Illustrated History of Hong Kong

As 1946 drew to an end, conditions in China became more disturbed, the civil war expanding with consequent disruption of life. Rampant inflation, restless movements of frenzied people seeking food, security, and a livelihood, together with labour unrest in the main centres, all contributed to the breakup of a bedraggled economy as the Nationalists suffered defeat after defeat and as the influence of the apparently unstoppable Communist armies waxed.

Stringent restrictions on imports meant that cargoes destined for Chinese

ports were refused entry, and the colony's warehouses became the dumping groun_d of goods consigned originally to Shanghai, Tianjin, or other ports. The less securely financed of the colony's merchants failed, one after another, leaving trade largely in the hands of those bigger firms with which it had been for decades before the war. It was into this troubled commercial scene that there erupted a flood of Chinese from over the border: whole businesses and their manufacturing equipment arrived without notice and strove to set up in what seemed to them a blessedly stable environment.

In the last years of the 1940s China's share of Hong Kong trade fell

sharply, its place quickly taken by the South-east Asian countries. With the Hong Kong merchants' ability to provide textiles from China in a textile­ hungry hemisphere, opportunities opened up for trade in new markets in the Middle East as well, and also with East and South Africa. When the Communists finally became the masters in China in 1949, the flow of exports dried up. The South-east Asian, Middle Eastern, and African markets for textiles virtually fell complete into the hands of the colony's merchants and newly arrived manufacturers.

The Communist revolution in China sealed off that country from virtually any contact - business or other - which the new regime did not wish to entertain. Shanghai port was closed by the stationing of guardships at the estuary of the Yangzi, while the blockade of Taiwan made shipping in that quarter a hazardous venture. All trade, such as it was, with central and north China was routed via Tianjin and Qingdao, and exports from Shanghai came by rail via Guangzhou to Hong Kong. The period was also marked by the illicit export of goods via Macau. High-value goods from south-east China such as bristles and tung oil (used in paint manufacture) were chiefly carried by air, a means increasingly employed in trade at the time. The first train-load of export goods from China after the Revolution arrived in March 1950. But this traffic was suspended at the beginning of the Korean war in June 19 50. The confused situation posed a challenge to Hong Kong merchants who continually varied the routes and the methods by which they acquired goods from China for export, but while trade with China dwindled to a trickle it was Hong Kong which monopolized it. The inflated prices of those years give the impression of a much greater volume than was the case, and by the first years of the 1950s a large number of merchant ships lay idle in Hong Kong harbour.

Growth of an Industrial Giant 29 5

The advent of the Korean war, in which China backed the Communist North Koreans, dramatically altered the picture. Chinese government agencies began buying on a large scale, and to pay for what they were buying the export of produce restarted. Import licences were freely issued by China and, to the relief of Hong Kong's merchant community, the stocks in their godowns were quickly cleared. The goods in demand by the Chinese were those to support the war - petroleum and its by-products, rubber and manufactured rubber goods, vehicles and spare parts, industrial chemicals, machinery, and electrical appliances.

Hong Kong found itself in the position of the Chinese government's chief

supplier and warehouse, on which it could draw on demand. In 1950 the tonnage of goods handled in the port leapt by 29. 3 per cent, and the total value of trade by 48 per cent to $2,434 million.

But one more drastic change in the pattern of trade was to follow. In December 1950 the United States placed an embargo on the supply of strategic goods to China because of its participation in the Korean war, this to be followed in 1951 by the embargo placed for the same reason by the United Nations. American goods imported by Hong Kong fell by about 50 per cent, as did the colony's exports of Chinese goods to the United States. The Chinese reacted by allowing exports only to the value of imports. The entrepot business of Hong Kong came effectively to an end.

Such, then, were the principal factors which were to affect Hong Kong

during the 1950s and after : the decline in the entrepot trade; the post-1949 influx of population and manufacturing facilities (labour, capital, and machinery); and the new Chinese government's policy of trading with other Communist countries rather than with its traditional suppliers.

Among that flood of humanity arriving in Hong Kong were men and women, both young and energetic, with an urge to get ahead in life by the use of their intelligence as well as their labour. Others were Chinese already established in life, who brought their considerable capital resources with them - among these the Shanghai textile industrialists whose entrepreneurial skills were now put to · use in Hong Kong. At this time, too, there was an influx of capital and business skills from the West and from South-east Asia

- the colony being seen as the most politically and economically stable place in the Far East.

Yet other things were working in favour of industrialization. As a British colony the territory enjoyed Commonwealth Preference and membership of the sterling area. While these two factors may not strike the contemporary observer as important (and they have long been abolished), in the aftermath of the war and in the period of doldrums following the embargo on trading with China they had a certain value. Membership of the sterling area made for stability in the Hong Kong dollar; Commonwealth Preference sharpened the competitive edge of products in certain markets.

296 An Illustrated History of Hong Kong

The clinching element in the rise of industry was the laissez-faire capitalism which had been the spring on which Hong Kong had several times in the past rebounded from slump to boom. Government non-interference and the absence of official meddling, economic liberalism and the absence of foreign exchange controls, its status as a free port - all these made Hong Kong an attractive place to set up manufacturing.

It was at this point that there began to form a unique entity which can best

be termed an industrial colony. From the start in 1841, Hong Kong had been unique in that it existed as a colony solely because the colonizers needed a secure base from which to expand their illegal trade in opium to China. More or less fortuitously it developed into one of the great entrepot cities of the world, and so remained until the Japanese war. The war over, there occurred a second birth in different guise. Both manifestations of this strange colony existed without the semblance of material resources. Success came to the first with the opening of China to Western goods, and to the second, a century later, with the virtual cessation of that process due to internal Chinese events

- which, incidentally, provided the manpower for its success.

As much as numbers, this manpower had a quality not possessed by the Chinese sojourners - the overseas Chinese - in Malaysia and Singapore, who are from many provinces of the motherland. The Hong Kong Chinese were and are virtually all Cantonese, speaking one version of the Chinese language, the Chiu Chow speakers and others being in such a small minority that they are forced to communicate in Cantonese. The Cantonese of Hong Kong, although not a homogeneous population - there are rich and poor, peasant and urban people - are unique in forming 97 per cent of the total population, more than was ever the case in any other overseas Chinese community in the Orient.

The growth of a manufacturing economy in Hong Kong, for every resident of the colony over the past thirty years, has been a visible, inescapable matter. In the mid- 1950s an observer standing on one of the piers in central Victoria (by that time rarely so called in preference to the simple term Central), and looking over the harbour to the north-east, saw the shores of the Kwun Tong area as a virtually empty landscape of green scrub, with one or two small ship-breaking yards. A textile factory and a cotton-spinning mill began operation there at around that time, surrounded by open country. Standing at the same vantage point in 1984, three decades later, one saw that the green hills in the background had been gouged out and presented the raw wound of a vast quarry face, beneath whose ochreous scars there had risen a close­ packed industrial area from which every trace of the natural landscape had long disappeared. Intervening between this and the viewer was the long extrusion of the airport runway at Kai Tak, built since the 1950s out into the harbour, serving what has become one of the world's busiest airports.

The industrialization of Hong Kong is an urban epic of perhaps unequalled





Tuen Mun, one of the huge new industrial towns which have sprung up since the 1960s, partly constructed on reclaimed land. What had been villages changed in a matter of a few years into large towns of hundreds of thousands, housing intensive industrial activity.



proportions. In a world still stumbling out of the ruins of the most disastrous war in history, Hong .Kong was in the position to supply many of the manufactures that austerity and sheer lack of materials and manpower in that war had made scarce. It was also in the position of a debutante, unfettered by older-generation ideas, willing to equip itself for the exploitation of ne,v processes and the utilization of new materials - and the satisfaction of new appetites.

Plastics were enthusiastically taken up by industry, and as they evolved in sophistication, gradually usurping the place of traditional materials, Hong Kong industry kept abreast of developments and explored the markets. One early product which came to be called in Japan (where the colony discovered a big market) 'Hong Kong flowers' was precisely that. But the fashion passed, as did another .which was supplied by Hong Kong, the Western craze for wigs, which for a few years kept some factories running 24 hours a day.

Statistics demonstrate dramatically (in keeping with the actual process) the

upsurge in the colony's economic activity in the 20-year period of its transformation into a world industrial and financial centre of mammoth proportions (see Appendix 8).2

Looking at some of the figures for r984, the total gross domestic product

298 An Illustrated History of Hong Kong

had risen to $ 178,071 million (from $2,489 million in 1949), the total exports to $ 137,936 million, and imports to $ 153,955 million; the gross domestic product per capita also rose, to $33, 197. The numbers employed in manufacturing in 1984 were 904, 709 persons and the number of manufac­ turing establishments was 48,992. Workers' wages in manufacturing had shot up to $91 per day. In the money and banking sector total deposits in 1984 were $296, 103 million and total loans $286,277 million. The revenue of the territory in 1984 reached $ 36, 194 million while public expenditure was $ 32, 338 million.

The activity of the stock exchanges, of which there were four until they

were unified in the mid- 198os, by 1980 had almost reached the peak attained in 1973 before the oil crisis (see Appendix 9). By 1984 the figure for total turnover had reached $48,787 million, and the Hang Seng Index ended that year at 1,200. 38 (31 July 1964 = 100).

In terms of the contribution of different economic sectors to the gross domestic product, the manufacturing industry has taken first place for many years, in 1983 contributing 21.9 per cent and in the following year

24.6 per cent.

The vast change in society in Hong Kong is signalled by the figures for money spent on the social services. In 1949-50 their share was 16. 7 per cent of revenue; in 1984-5 the total rose to 35 per cent ($ 13, 199 million). The percentages for other government functions in that year were : community services 9 per cent, general services 40 per cent, economic services 3 per cent, and security services 13 per cent.

To deal efficiently with the export of Hong Kong's massive product, and equally to take in its volume of imports, by 1984 the territory had con­ structed the largest container port in Asia - the third largest in the world, soon to become the largest.

The rise of the banking and financial services sector was equally surprising. In 1984 there were 140 licensed banks in operation, the numbers still rising steadily year by year, their assets in 1984 standing at $903,568 million, a figure which was soon to increase dramatically.

The rapid rise of tourism as a factor in Hong Kong's economy contributed over fourteen billion dollars in 1984 and the numbers of visitors rose to 3,500,000 (up by 12.9 per cent on the previous year). As many new hotels opened and further attractions were added to those already drawing tourists to Hong Kong, the figures looked promising for further increases.

In the past two decades the whole character of Hong Kong has altered radically. The sapling has become a great tree, almost overnight. While a walk around central London or Paris today certainly affords a different feeling from the same stroll two decades ago, the change is largely composed of an accumulation of small details. The place has been smartened up, might be one way of putting the facts. In Hong Kong a stroll through the principal



The waterfront m 19 60.



1i

!'

When complete'd in 1962 the City Hall buildings were soon to be joined by the Mandarin Hotel (under construction, right of centre) and by the Hilton Hotel, under construction on the corner of Garden Road. The cricket ground behind the graceful old Hong Kong Club was still in use.



The panorama of Hong Kong and its harbour in 1988.



thoroughfares in the last year of the eighties reveals scarcely a building which was standing twenty years ago. One or two 'historic' piles remain - the old Supreme Court building, the tower block of the City Hall, new and very modern it seemed in 1962 and now dwarfed by all of its neighbours. Of the major buildings lining the streets of Central three decades ago only the Supreme Court and the Bank of China's old building still remain - all else has disappeared and the fabric of the city's centre is in reality a new construction.

The achievement of the early 1970s, a desperately needed amenity, was the

completion of the first cross-harbour tunnel for motorized traffic, opened in 1972. By 1984 the tunnel had proved hopelessly inadequate for the rapidly rising number of vehicles using it, and another crossing under the eastern harbour opened in the last year of the eighties. This decade also saw the completion of a highway built above a further reclamation of the coastal waters of the harbour, linking the business district of Central with Chai Wan to the east. About the same time a highway linked the Kowloon peninsula with the China border, and vast improvements were made in the road system of the New Territories, in response to the needs of the new towns with their large populations and growing industry.

In the sixties and seventies a hu'ge effort was made to provide Hong Kong with an adequate water supply. Plover Cove reservoir came first, completed

Growth of an Industrial Giant 301

in 1968, the sea drained from the cove after a barrage was built between a narrow peninsula and the village of Tai Mei Tuk along the coast from Tai Po. Later came High Island reservoir, similarly formed and adding another great libation. It has not, however, in the end proved possible to provide adequate water supplies for Hong Kong from within its boundaries. The major supplies come by pipeline from China which sells Hong Kong more than half of the 75 0,000 million cubic metres consumed annually in the territory.



Water shortages became acute in the early 1960s, and the queues formed as they had done in former days - only the receptacles differing (see p. 199).



More ambitious than any of those investments and developments was the Mass Transit Railway (MTR) which was begun in 1975 and took 14 years to complete at a total cost of over twenty billion dollars. This highly efficient underground railway, air-conditioned, clean, fast, and connecting huge centres of population, transports vast numbers of people daily which it would not be possible to transport on the roads. During its construction the old Kowloon-Canton railway (KCR) was modernized, double-tracked through­ out, and electrified. The MTR and the KCR are integrated at Kowloon Tong

302 An Illustrated History of Hong Kong

station, effectively forming one system. The influence of these expanded and new transport facilities has been profound. New patterns of traffic and population movement have emerged. What were to all intents and purposes two separate cities, Hong Kong and Kowloon, have merged in a way which could never have been achieved when their sole connecting links were ferries across the harbour.



The first of the new reservoirs constructed to supply the needs of a rapidly rising population and growing industry was formed at Plover Cove in 1968.



The ferries still run, and the harbour, diminished by extensive reclamations on both sides since the last war, is probably more alive with boats of all types and sizes than at any time in its history. Long gone are the junks, but multiplied as if by spontaneous generation are the ferries linking numerous parts of the territory. Joining conventional vessels are hovercraft that make their swift way up the yellow waters of the Zhu Jiang to Guangzhou and other centres, and the skimming hydrofoils and jetfoils plying every few minutes between Central District and Macau, where that old city has in the past twenty years wakened from its Rip Van Winkle slumbers. Now crowded with new hotels, the mecca of Hong Kong's compulsive gamblers, Macau is experiencing a reawakening, in large part a reflection of Hong Kong's expansion.



I ,.

Ill

�



The construction of the Mass Transit Railway, Hong Kong's Underground or Metro, disrupted life for some time.



In Hong Kong also gambling is still a passionate preoccupation with the man in the street. The old racecourse in Happy Valley, during the past few decades equipped with huge grandstands, still functions. The new course at Sha Tin in the New Territories, larger, with even bigger stands and amenities, opened in the mid-r98os and draws crowds whose wagers form the wealth of the Royal Hong Kong Jockey Club. The Club is the largest financial benefactor of Hong Kong, annually donating hundreds of millions to an array of ch,aritable organizations whose needs would otherwise have to be met from the public purse. Hong Kong, it seems, prefers to lose its money by gambling rather than by the surgical incision of income taxation.

304 An Illustrated History of Hong Kong

In the seventies and eighties Hong Kong has acquired a cultural life, something which it all but lacked before. The occasional visiting theatre companies of the past which entertained the Western population, and the performances of Chinese opera enlivening Chinese festivals, were almost all the art to be discovered in the territory, historically speaking. With post-war internationalization and a rapidly enlarging affluent society came art in its various forms. The visual arts, slow starters because of the long-acting delicious drug of Chinese traditional painting, made an electrifying break­ through to the present in the late r960s when a handful of younger artists developed into painters of stature pioneering new styles. The influence of one man of genius, Lui Shou-kwan (Lui Shoukun), founded a school from which its adherents branched off in their own directions in due course, so that by the first years of the seventies Hong Kong was the leader in contemporary Chinese painting. The catalyst was the impact of Western art and, no less, Western styles of life - as surely as black African rhythms had proved the mainspring in the jazz revolution in America and later the whole world.

The formation of the Hong Kong Philharmonic Orchestra and of various

Chinese groups playing old and new Chinese music added a dimension previously lacking in the territory, as did the formation of a resident theatre company playing in Cantonese and English, and a fledgling ballet.

The beginnings, the almost furtive infiltration of appreciation and practice of contemporary arts in Hong Kong, may be traced to the opening in 1962 of the City Hall with its large and smaller auditoriums, affording a home for music and theatre, and for the less commercial aspects of the cinema. Slowly other venues opened, the Arts Centre with theatre and art galleries came in the seventies, the Academy for Performing Arts a decade or so later. In 1972 the South China Morning Post began to print regular reviews of art exhibitions and was followed by other publications. Magazines devoted to, or noticing, the arts in major features slowly multiplied as the impact of television was felt. Art exhibitions, once a rarity and mostly of determined parochiality, are now plentiful. Some at least of the work of modern and contemporary artists from the West, from Japan, and elsewhere is shown quite frequently, and large commercial companies have in the past decade begun to patronize the arts in a meaningful way. The phrase 'cultural desert', once heard with depressing frequency (and accuracy), is no longer apt.

Culturally, Hong Kong has, superficially and some depth down, interna­

tionalized. But the infusion of Western modes and philosophies in the arts has at best produced a series of variants which bear a singularly Chinese flavour. Culture, if not readily transplantable, is almost infectiously adaptable.

Hong Kong, in the decades of its gigantic explosion in population and

productivity, has become a place quite unrecognizable from its pre-war self. Not only is its raison d�etre basically a different one, but it has become an intensely metropolitan place, a city in which a curious and not unpleasing

Growth of an Industrial Giant 305

form of sophisticated Chinese life flourishes. It has a core of diamond hardness as have all great cities, different in quality from the feeling of Chinese Singapore, infinitely more worldly than any city of China itself. The atmosphere is a combination of Chicago, Detroit, and New York, with special intensity lent to it by the dominant Chinese inhabitants, beavering away at their absorbing quests of making money and enjoying themselves. These aspects are combined also with a certain European ambience. Hong Kong exudes success in the manner of a sophisticated magnate, somewhat nouveau riche, a little parvenu. But in its boisterousness and in i ts riches, it is a wonderfully alive and exciting city to live in.

24 . Corruption and the ICAC



ONE of Hong Kong's urgent problems in the decades since the war, a problem mirroring to an extent and in a Chinese manner those of cities such as Chicago which showed the same rapid development and acce§S of riches, has been how to moderate the results of the arrival and redistribution of wealth that tumbled like summer rain into the community. The events of the post­ war years have been turbulent, in part as ever because of pressures from outside the colony, but as acutely from the rapid social changes taking place within.

Conflict between the British and the Chinese had often centred on their differing concepts of law. The laws of China, customary, unwritten, were intended like those of other nations to establish and maintain harmonious human relations in a society with sufficient means of material survival. Those of Britain, with the same aim were, however, written. The conflict resided as much in the difference between the two civilizations as revealed in their laws as in the laws themselves. The British concept of the absolute right of people to trade reflected a powerful free society: the Chinese concept that trade was a privilege granted by an emperor reflected a largely self-sufficient society which had always lived under authoritarian rule. The responsibility for an unlawful act was to the British that of the person who committed it: to the Chinese the responsibility was the same, but should the culprit not be

discovered, then his family, village, or association bore the responsibility and II

had to pay the penalty.

In Hong Kong, the only urban place where the British had ruled a homogeneous population of Chinese, the two concepts of law came frequently into conflict. It seemed that the differences between the two civilizations were only reconcilable if aspects of one or the other succumbed. This did not happen in any important way until some time after World War II.

At the core the disparity between Chinese customary law and British written law lay to a large extent in the absence in Chinese tradition of the slightest tendency towards a democratic process. Democratic ideas were, after all, quite as foreign to the Chinese as socialist ones (and doubtless

Corruption and the ICAC 307

Confucian principles as a foundation for law would be found uncomfortable to live with in a Western country). The fact that Britain had a history of democracy in theory and practice (if rather recent in the latter), and that China had a very long history of Confucian imperial rule in theory and practice, were the constructs of their differing histories and environments. The world's greatest achievements have occurred under democratic, Confu­ cian, and several other types of law. No people or nation has a proprietary right to sole possession of the attributes of civilization.

Chinese society had long been ordered by a Confucian concept termed 'filial piety', meaning respect for persons, especially older males. Hence sons (and all female members of a family) respected and obeyed the father; and the father paid respect to his father and elders; and so on up the pyramid of officialdom to the semi-divine emperor. The emperor bowed only to the gods, and all Chinese were regarded as his spiritual children (we may note the word 'children') - the 'seed of the dragon'. The principal system of advance­ ment was via the civil service examinations from among whose successful candidates there emerged the administrators of the future, with whorn under imperial guidance all authority and means of government lay.

In practice, the focus of all real authority was the local magistrate who administered justice, settled disputes on the basis of customary law and Confucian ethics, and had to be petitioned in regard to most requests of a serious nature. The omniscience, the Confucian benevolence supposed to characterize all holders of office, who in turn were answerable to a chain of higher authorities, was often more theoretical than real. Magistrates were pitiably ill paid, and this, with 'human nature', led to what became an institution in itself - the exaction of higher taxes than was permitted, the magistrate creaming off a percentage before remitting the taxes to the imperial treasury.

Hence, as every Chinese knew from childhood, to reach the ear of the magistrate with a request, it was necessary to offer a sweetener to one of his clerks. This was not thought of in the British sense as bribery, nor as gaining an unfair advantage. Life with its problems had to be lived by all and the wheels of authority had to be oiled.

I

!

Hong Kong law was British law with certain modifications, and was respected perhaps as much in the breach as in the observance. We have seen numbers of instances of Westerners in breach of the law - venal policemen paid by illegal gambling houses are matched by the equally venal Duddell in his double dealings, and by crooked lawyers. In essence it was the conflict of ideologies and its exploitation by both British and Chinese that led, after scandals had racked the colony, to the setting up in 1974, at the instigation of the then Governor, Sir Murray MacLehose, of the Independent Commission Against Corruption - the ICAC. This Draconian body was at first viewed

i with dire suspicion, seen by some as a governmental Gestapo or secret police.

II

308 An Illustrated History of Hong Kong

But, with its brief to deal without fear or favour with rich and poor, high and low, official and ordinary citizens residing in Hong Kong, it has in the intervening years come to occupy a position of cautious acceptance and some respect. r

The post-war upsurge in corruption in Hong Kong on all levels and on a

grand scale was in some degree a response to the opportunities offered in a thriving city, with a more or less booming economy, and an absence of official interference in the ordinary affairs of its citizens. Public opinion among, the Chinese did not sharply define the subject. The possibility of argument between moralists (corruption is a sin) and fundamentalists or pragmatists (oiling the wheels assists harmonious movement) is a topic of endless debate. Samuel Pepys, Secretary of the Admiralty and president of the Royal Society in the latter part of the seventeenth century in London, was highly thought of in his time as a good civil servant. Everyone knew he lined his pockets, but it was also known that he was not extortionate in so doing. Time and place come into the equation. Hong Kong lacked a Chinese mandarinate in the traditional sense, and it also lacked an elite in the British one; it lacked therefore the sanctions of traditional authority. These con­ siderations are not advanced as an 'excuse' for corruption but as elements in its rise and spread. Sir Hercules Robinson with his cadets had attempted to inject an artificial elite into the civil service, with generally favourable results - few cadets fell by the corrupt wayside. But for the rest of the community - the 'Aristocracy of the Moneybag', to recall Carlyle's damning phrase - Hong Kong society, Western and Chinese, did not lend itself easily to Western rigidity on moral matters. Merchants are by nature pragmatists, as are many Chinese.

April of 1966 saw events which had no precedent in the colony. The first was the appearance of a lone protester garbed in black, who sat in the Star Ferry concourse on the 4th of April from 9 a.m. until the last ferry had departed. On his clothing was written in white: 'Hail Elsie ! [Elliot, Urban Councillor] Join hunger strike to block fare increase. Democratic'. This referred to the ferry company's request for a rise in fares of both first and second class accommodation on the cross-harbour run. The government had allowed a 5 cent increase on the first class fare and none on second class. The youth was seen by most people as a crank. On the second day of his 'hunger strike' he was arrested for obstruction. He played no further part in the story.

But what he had achieved (with the incautious assistance of the media) was a focus on the 'youth problem' which was in part a product of the r96os permissive society phenomenon in the West, and in part a reflection of the so­ called Cultural Revolution in China.

There followed three nights of rioting in Kowloon where startled tourists and citizens alike could scarcely believe their eyes as youths rampaged up and down the 'Golden Mile' of Nathan Road. Not one of these rioters was really

Corruption and the ICAC 309

protesting about a fare increase - few would ever have travelled first class - but it seemed they were motivated, initially at least, by a fear that rising prices were not being properly compensated for by wage rises. There was, too, a certain communal unease at this time, possibly stemming from the failure of the Canton Trust Bank the previous year ( 1965) in which its 114,000 depositors recovered only 25 per cent of their savings. This had been followed in the February of that same year by the spectacle of the large Hang Seng Bank running into difficulties. The crisis of confidence had been eased by the intervention of the government and the Hongkong and Shanghai Bank which had stepped in and taken over the Hang Seng. Yet another factor in the violent reaction to what was hardly a life-threatening situation may be seen in the Chinese memory of the appalling period when, in its terminal phase, the Nationalist government of China failed to avert the complete collapse of the currency and an untold number of people lost all they had.

The second night of demonstrations saw more rioting in Kowloon and the stoning of police by crowds of youths swelled by others who appeared to join in when they saw the 'fun' becoming more promising. By 8 April the police were in control; r,400 youths were arrested, one rioter was killed; looting had been severe.

An official enquiry was held, in dramatic circumstances, with the Commissioners led by the Chief Justice, Sir Michael Hogan, seated under the floodlights on the stage of the City Hall Theatre, the audience seated as if

attending a play. The tangled, bungled travesty of a procedure which

unfolded during the hearings of this ill-conceived Commission need not concern us in detail here. A few facts tell the story. Elsie Elliot, an Urban Councillor, renowned for her support of the 'little man' in his troubles in a new, brash city society, was subjected to harsh and harassing questioning on her alleged part in 'inciting' some of the original demonstrators, which was not proven. She was also brought into the equation by the police who virtually accused her of being a common troublemaker. Certainly she was, on her own admission, a tireless writer of protesting letters to the police on behalf of hundreds of ordinary Chinese, who had no recourse other than to her good offices in their attempt to right wrongs done to them. But the side­ effect of her persistence in citing police corruption brought to an acute stage the course of the Enquiry, with the suspicion hovering in the minds of most that the police were 'gunning' for her because she was not only a thorn in their flesh but, more seriously, a potential danger to them.

The Commissioner of Police, Henry Heath, an old-school policeman, was largely distinguished by a fierce loyalty to his force. In them he could see no (or at least hardly any) evil. He was almost comically out of his depth in terms of what constituted the possible bases for the concept of corruption. When Mrs Elliot accus'ed the police of specific cases (on the evidence of a police source which she would not identify because of probable reprisals), the Enquiry

3 ro An Illustrated History of Hong Kong

reached a climax. She was, as all now acknowledge, merely restating the knowledge of the ordinary person of the colony on the extent of police corruption; but her official audience refused to credit her. Her statements (rightly, as it turned out) were seen by the police as threatening a very lucrative way of life. The time was not ripe for these revelations; it was only later that it all came out.

The Enquiry censured Mrs Elliot, Sir Michael sentencing her (because there was nothing to which he could legally send her for trial) 'to the bar of public opinion where she must meet the censure and repudiation of all those right­ minded people who believe in the freedom of the innocent from the taint of unwarranted suspicion and in the principles of frankness and fair dealing in the affairs of men'.

.

In the history of judgements and in the affairs of Hong Kong men - in the light of what was to be uncovered in the near future - these� words must be seen as appalling flummery. The Enquiry proved nothing except that police

.

corruption was to continue.

All unintentionally, the Enquiry had opened a can of worms. The ordinary person, reading its proceedings in the daily press, saw then the obscene wriggling, and smelled the stench which is said to emanate from corruption. The Commissioner of Police had admitted that there was some corruption in the police force 'but not the worst' in relation to that in other departments of government. He also stated that the police needed bribes to pay off their informers!

The Enquiry was obviously baffled about the cause of the riots, stating (in 2,400 pages) that they were not caused by 'political, economic, and social frustrations'. Lethbridge, wittily and appropriately, quotes Auden's lines:



The situation of our time Surrounds us like a baffling crime.2

Once more Hong Kong had excelled itself in a scandal of monumental proportions. Worse was to follow. In due course the whole devious process of the enforcement of law and order came like some carbuncle to a head for all to see. There was an intermission before the crisis and lysis of the last act.

The events of the intermission were largely a reflection of the ongoing Cultural Revolution across the border in China. On 6 May 1967, not long after the conclusion of the Enquiry, a dispute took place between workers and management at the Hong Kong Artificial Flower Works at San Po Kong. In the context of a tense situation the dispute was inflated by the interested parties to absurd proportions. A fever of violence overtook the colony, and for six months clashes occurred between throngs of hysterical demonstrators, egged on by agitators and activists of various persuasions. Large numbers of them were involved, becoming progressively more aggressive under what was



Demonstrators in May I967 chanting and waving the Little Red Book outside Government House.



evidently a well-organized leadership. Mobs rampaged through the streets in defiance of police orders, causing considerable apprehension amongst the populace. Those who could afford to do so left for safer places, taking with them their valuables.

The climactic pitched battle between a chanting, screaming, Red Book­ waving Maoist mob and the police came as the former attempted to move up Garden Road towards Government House, intent on holding an anti­ government demonstration there, as they had previously done. They were stopped by police on the corner by the Hilton Hotel. Provoked by the dangerously aggressive crowd, the police launched a classic baton counter­ action, arresting numbers of them before they melted away. A game of cat and mouse was then started by the mobs,. confronting the police in areas such as Wan Chai where its narrow streets and lanes served as escape routes. The mob would attack, and move away partially or wholly, causing the police to follow, only to reappear on the flank or even at the rear down some other street. The formerly passive police role had necessarily to become an active one involving raids on suspected premises and searches in which incriminat­ ing docum�nts were discovered. 3

In the face of this acute threat to life and limb, and to the government of Hong Kong, police action was generally applauded. Demonstrators who

3 r 2 An Illustrated History of Hong Kong

attempt to stab out the eyes of policemen and are caught in the act by cameras are not likely objects of much public sympathy. The police, overnight, turned into heroes. As a force they carried out their duties in exemplary fashion, and numbers of individual officers acquitted themselves with great courage. Criticism of the force, which had been simmering in the wake of the riot Enquiry, died a natural, if temporary, death. Some senior policemen displayed conspicuous gallantry in various episodes during raids on Com­ munist premises. The Chinese police, who were portrayed in the left-wing press �s 'running dogs of the Imperialists', also distinguished themselves in episodes requiring a like courage. The police were, for perhaps the first time in their history, popular figures.

When the confrontation was over the death toll was 5r: of these, r5, in­ cluding Chinese children, were killed in a bomb explosion; ro were police officers. Over two hundred persons were wounded, several�severely. Hong Kong business men set up a fund to help the further education of policemen's children; Her Majesty The Queen honoured the Hong Kong Police Force with the prefix Royal; and the Governor, the imperturbable Sir David Trench, went on playing his rounds of golf at Fanling within hail of the border and the gesticulating masses beyond it. Cricket, which had been played on the most valuable piece of sports ground in the world in the heart of Central, under the bemused gaze of Communist workers in the Bank of China adjacent, also went on as usual with the stone-throwing, yelling mobs periodically charging round the perimeter. It was a splendid, late, vintage demonstration of that nineteenth-century heyday-of-the-British-Empire spirit. But the end of the confrontation came not so much as a result of stern British action in the colony, as from the Chinese over the border issuing orders to cool the ardour of their supporters in Hong Kong.

Meanwhile, engaged in crowd control and in making deterrent raids, the

police had no time to attend to the more usual forms of law-breaking. Crime flourished as never before. The Triad societies had collaborated with the police during the Maoist uprising - not wishing to see their lucrative territory taken over by leftist puritans. When calm returned they were found to be more deeply entrenched in crime, and more involved as spies and informers with the police than before.

The real nature and extent of what was afoot in the miasma of corruption that hung about the colony was aired initially in an article written in 1970

by an often aggressive custodian of public morality, Leo Goodstadt, in the Far Eastern Economic Review. It was headlined: 'Squeeze is a way of life in Hong Kong'. The thought was hardly new. But its accuracy and its public expression were disturbing to the ordinary Westerner and also to the police. The Chinese assumed that government departments were in some degree corrupt; but for the British, who·se heads were half-hypocritically, and in some cases actually innocently, buried in the sand of unknowing and

Corruption and the ICAC 3 r 3

reluctance to credit such unsporting practices, the shock administered by the publication was deeply unsettling. Why, they asked, did the government allow such a state of affairs to come about, and how could they have let it continue to such alleged proportions? The Governor, Sir David Trench, on television in the late 1960s, failed to make any reply to the question put to him. His successor, Sir Murray MacLehose, was more frank, in October 1973 agreeing that corruption had been 'on a more extensive scale than I had realised'.

In the ensuing period the various aspects of the problem loosely named corruption began to become evident. Corruption, at base, is essentially a concept that springs from the democratic idea. In corrupt practice you and another - the contact - are conspiring to gain an advantage (whether monetary or other) which is not available legally in that society. In a society where the law or the custom does not prohibit such transactions, at least when they are of a petty nature, then the transaction is not precisely corrupt. Hence in the mind of those brought up in such a society - the society of Pepys's time in England, of China down the dynastic ages, and most assuredly in late Qing times - corruption is a concept which is much more vague, not generally thought of as affecting the ordinary man in the street, but rather an affair of high places. This is not the case in a developed democratic society. In Hong Kong the majority of the populace belonged to a non-democratic tradition, but the tiny minority of Westerners, specifically the British since it was they who ruled, were brought up to regard corruption as reprehensible. In Hong Kong large numbers of otherwise 'respectable' persons had from the initiation of the colony lived and worked in corrupt dealings of one kind and another - the opium trade being one socially tolerated example. Hence the police force, mostly Chinese, and its higher officers, both Chinese and British, had in theory divided views on the subject. In practice a small number of the British content of the force viewed corruption as anathema, another section as one of the perquisites of office in the Orient where (they would aver) corruption was a way of life. These men had long participated in that

alleged way of life.

To eradicate corruption from such a force presented a problem of appalling complexity. It involved Chinese reactions to the possibility of being deprived of a healthy source of extra income regarded as normal 'perks', similar views on the part of the bribe-taking British officers of whatever rank, and the isolation of the- few uncorrupt policemen in the force.

The knowledge of widespread corruption was not new - the 1946 Pennefather-Evans investigation4 had delineated it, and Duncan Maclntosh, the next Commissioner of Police, avowed that 'he had never seen such widespreaq. corruption anywhere else'. 5 This was in 1946. The question can was how to set police to catch police, and the Anti-Corruption Branch established within the CID and given autonomy in 195 2 failed to do much

3 14 An Illustrated History of Hong Kong

about it. In the 1960s, as everyone knew, it was necessary only to have $400 in cash in order to obtain a driving licence - the ability to drive was irrelevant.

The case of Peter Godber in 1973 brought the matter to a scandalous head. Godber had been promoted to second-in-command of the Kowloon District in late 197 1. He had been decorated with the Colonial Police Medal for Meritorious Service in 1968, having acted with great courage during the troubles of 1967. In April 1973 the Commissioner of Police, Charles Sutcliffe, was giyen information privately that Godber was sending considerable sums of money out of Hong Kong. This led to an investigation by the Anti­ Corruption Branch which discovered that Godber's resources came to about

$4. 3 million - six times his salary between 1952 and 197 3. It is still not known how much he was really worth - certainly many times that. Godber had asked in the year previously to take early retiremept and this had been granted for 20 July 1973. He now asked to be allowed to leave at the end of June, doubtless reafizing what was in progress. This was refused. When served with a notice on 4 June, he fainted. He was given a week to 'make representations'. His wife left the colony on 7 June, and in spite of security checks at the airport, Godber himself left for Singapore en route to Britain on the following day. He knew that he could not be extradited from Britain for being in possession of resources or property disproportionate to his present or past emoluments, since this was not a crime there.

This saga was widely reported in the colony's newspapers, and also in Britain. The report of the ensuing investigation recommended numerous changes in various aspects of the police force in Hong Kong. On 17 October 1973, the Governor Sir Murray MacLehose, in a speech to the Legislative Council said: 'The escape of Godber was a shocking experience for all of us.' And he went on to argue for an independent anti-corruption unit:



it is quite wrong, in the special circumstances of Hong Kong, that the police . . . should carry the whole responsibility for action in this difficult and elusive field. I think the situation calls for an organization, led by men of high rank and status, which can devote its whole time to the eradication of this evil . . .



Sir Murray, then, was the prime mover in the creation of the ICAC. The Governor at this point reached the height of his popularity, his tall presence and entire rectitude exactly what were needed. The ICAC was formally set up on 15 February 1974, its arrival on the scene accompanied by much natural but in fact unwarranted optimism that Hong Kong would soon become a 'clean city'. The depth of institutionalized corruption, and its effects on life in the police force as well as in other circles, was hardly appreciated at the time. Those effects were soon to show themselves - with near disastrous consequences.



The Governor, Sir Murray MacLehose, and Lady MacLehose in November 1971.



The ICAC had serious recruitment problems, but under its excellent first head, Mr (later Sir) Jack Cater, it established itself as a permanency. Its prosecution of Godber on an extraditable charge in 1975, and his imprisonment, made a deep impression on the public which was strengthened by the Governor's appointment of Mr (later Sir) John Prendergast, an officer who had worked in Hong Kong previously and was highly respected, as Director of Operations-of the ICAC.

In the years that followed, the ICAC concentrated on a series of targets

with considerable success. The commissioner in his 197 5 review could state that it had been a year of consolidation and 'of preparation for the titanic struggle which lies ahead. For our aim is to break the back of organized, syndicated corruption within the next year or two. 1976 and 1977 are going

to be crucial and testing /ears both for the commission and for the community of Hong Kong.' These were prophetic words.

By 1977, so successful had the ICAC been in prosecuting crooked policemen that those who had already retired had started leaving Hong Kong for safer places, safe from the sudden, before-dawn appearance of its officers

at the door and arrest on charges of corruption before retirement. But in the

l

l serving force very large fortunes were still being made through syndicated

I

means. In March 1977 the Commission had under investigation no fewer

than 23 big corruption syndicates, 18 of them operated by police. By July the Commissioner could report to the Governor that 'no major syndicates were known to exist'. It was this radical cleaning of the nest which proved to be the flashpoint.

316 An Illustrated History of Hong Kong

With the arrest of 59 sergeants of the Wan Chai Division in 1976, staff had to be transferred to that Division from elsewhere, and a situation had arisen unequalled in its gravity even by the 1897 corruption scandals. The culminating event was the Wan Chai conspiracy trial in which 12 police officers and three civilians were charged with conspiracy to pervert the course of justice and to accept bribes. Police morale plummeted as a result. They felt beleaguered, betrayed by their higher officers. One expatriate Senior Superintendent shot himself after much aggrieved talk about the deleterious effects of the ICAC on police morale. Morale declined in parallel with the decline in police revenue from corruption, a loss of income made graver by the clamp-down on vice establishments from which much illegal money fell into police pockets.

In October 1977, 140 police officers of the three Kowloon divisions were arrested for alleged involvement in syndicated corruption. Op 25 October, 34 police including three British superintendents were arrested and detained. This led to the organization of rallies by groups of police to publicize their claims that the ICAC was indulging in harassment. Delegates called on the Senior Superintendent (Administration) of Kowloon and were advised to put their complaints in writing. The next day about three hundred Kowloon police gathered and drafted a letter to the Commissioner of Police. This nine­ point document was a curious mixture of special pleading and self­ commiseration. Among its complaints were that the ICAC used convicted persons to obtain evidence against policemen on the promise of reduced sentences, which they stigmatized as 'moral corruption' and 'highly pre­ judicial to the officers involved'. The ICAC was 'perverting the course of justice' by such acts. The hardship caused by early morning arrest and the long period of detention after arrest was felt to be 'particularly burdensome on long-serving officers who have shown their loyalty in many ways, includ­ ing the 1967 riots'. Senior officers knew of corruption syndicates but took no action, so why were junior ranks penalized? They complained also of the likelihood that criminals would make false allegations against police which would be believed. The document's general conclusion was that all forms of victimization should cease.

The Police Commissioner's response was a statement couched in the level, flat jargon of officialese, and was a model of conciliation:



I want you to know that there is no lack of concern on my part over the matter of certain aspects of investigations into allegations of corruption in the Force. I realise too the strain that these investigations have placed . . . throughout the Force. I have sought to ensure that members of the Force are treated no differently from others similarly under ICAC enquiry . . .



This cut absolutely no ice. On 28 October at about 9 a.m. some two

Corruption and the ICAC 317

thousand Hong Kong island police gathered at Edinburgh Place where they were joined by the Kowloon contingent. After a few words from a Chinese superintendent they left, chanting slogans, for Police Headquarters in Wan Chai. In a car park close by the Commissioner's office, they massed. Five rank and file delegates then went in to see Commissioner Slevin (known as the 'Invisible Man'). After an hour they emerged and relayed the message that Slevin had agreed to the formation of a rank and file association, in effect a form of trade union, at least in principle. The large group then disbanded, cheering. But from its midst a small breakaway body marched to Hutchison House where the ICAC headquarters was located. This incensed mob of police officers who had been dismissed, or retired, together with some serving officers, forced its way to the Commissioner of the ICAC's office. Closed glass doors were broken and unlocked and the raiders burst into the premises. They were met by protesting officers of the ICAC and a scuffle took place, the ICAC heavily outnumbered and five of them injured. A police patrol arrived in response to an emergency call, and their police colleagues then left. Each side told a different story of what occurred, the police omitting to mention the cries for the Commissioner's resignation that had been heard, and saying only 40 persons were involved. The ICAC alleged 200 intruders.

In the outcome, an investigation by a team of nine high-powered police led

to the prosecution of one person - a retired police sergeant, whom the press were to call, with heavy sarcasm, the Lone Raider. The Attorney-General in the Legislative Council permitted himself the following statement: 'The report submitted to me by the investigating officers contained, save in one case, no evidence at all as to the identity of those who participated in the events and no admissible evidence even as to who were present.' This, despite the photographs of many of those participating which appeared in the press. The decision was political, the government shy of further alienating the police rank and file. But the smouldering fires smouldered on.

Between the Hutchison House break-in and 4 November, large meetings, both private and public, were held by police to plan future tactics. The government hope that the problem would simply go away was unrealistic. The Commissioner of Police's formal reply to the letter of complaint was received on 4 November, and over one thousand policemen met behind closed doors to discuss it. The more extre1ne views won the day and the reply was found unacceptable. There were demands for industrial action, for a strike, as means to force capitulation on the Police Commissioner's part to the terms outlined in their letter of complaint. It was apparent from the rowdy proceedings that the j unior elements were uncontrollable.

There was now quite obviously every prospect that the police would cease

to defend iaw and order and that anarchy might engulf the colony. The situation was taken so seriously by the Governor that he declared a partial amnesty for the police on the following day.

3 18 An Illustrated History of Hong Kong

The news was greeted with little short of astonishment in the colony, even with dismay. People could not reconcile the amnesty with the Governor's steadfast assertions and actions in the past on the subject of the absolute need for the ICAC. For now it seemed that Sir Murray was at least indicating some sort of partial retreat from his former stance.

His directive of 5 November addressed to the Commissioner of the ICAC has come to be termed the 'partial amnesty'. Its content was to the effect that in future the ICAC would not normally act on complaints or evidence relating to offences committed before 1 January 1977, other than those relating to

persons already under questioning, or persons against whom warrants had been issued, or persons not in the colony on 5 November. The phraseology used - 'not normally act' - excluded from the amnesty such offences considered to be so grave that it would be out of the question not to pursue an investigation. The Governor stressed that such cases would qe rarities. The 'partial amnesty' was belatedly given legal teeth in February 1978.

The hotheads, having smelled power, were not to be quelled by this and pressed for a complete amnesty, refusing a compromise. They then planned a march to Government House if no favourable reply was forthcoming on this by 5 p.m. on 8 November.

Sir Murray held meetings on 7 November with his advisers and the Acting Commander British Forces and mobilized support from civilian organs and prominent persons called to a special press conference. At 5 p.m. he called a meeting of the Legislative Council and inside twenty minutes an amendment to the Police Force Ordinance was pushed through. This granted the Commissioner of Police powers of summary dismissal.

The hotheads and the waverers had met their match. Agreement was eventually reached on a pledge of total loyalty to the Commissioner. Roy Henry, Deputy Commissioner, was to replace Slevin the following year.

There was great discussion about what forced the Governor to grant the partial amnesty. The pros and cons were exhaustively weighed. Sir Murray has never commented. The plain fact of the matter was probably that to have failed to grant it would have required the full strength of Hong Kong's British army units and the Gurkhas to step in and act as a police force until such time as the present force (which would necessarily have had to be largely dismissed) could be replaced by another. This alternative was simply not a practicable solution. Sir Murray had virtually no choice of action.

The outcome of the 1977 crisis (as the police prefer to call the events) was a slow conformity by the police in general to the letter of the law, and an immediate and quite prolonged diminution in the powers of the ICAC. Wisdom after the event would have it that the latter pressed too hard and too quickly on the police. That may have been so. It took a long time for these two organizations to get back on speaking terms, far less terms of co­ operation. By 1984 this had been in large part achieved.

Corruption and the ICAC 3r9

It would appear from the statistics that corruption in the police force has greatly diminished. To what degree the figures reflect a general lessening in the scope of corruption is an open question. Certainly large-scale syndicated corruption has been vanquished, but just as surely small-scale activities have not.

The ICAC, having lost face and come under the effective control of the Governor at the time of the partial amnesty, came to be regarded for a time with less public confidence. But its later good record in uncovering corruption at all levels and in all areas of Hong Kong society has largely restored it to its former place in public regard.

It would be folly to imagine that corruption has been even 50 per cent eliminated. But perhaps the Hong Kong police nowadays compare favour­ ably with the London metropolitan force - which was certainly not pre­ viously the case. The ordinary Chinese still steers clear of contact with the police in everyday affairs, and prefers not to report law-breaking rather than have contact with policemen, who are still seen as liable to take advantage in one way or another of involvement in personal and family affairs.

25 . Final Years



'WHEN I started negotiations in r 9 8 3 [with the Chinese on the question of the future of Hong Kong], there was precious little to be optimistic about', wrote the British Foreign Secretary, Sir Geoffrey Howe, in August 1988. He was replying to a letter published in the Evening Standard newspaper in London in which Sir Walter Monckton alleged that the main concern of the Foreign Office was to shed Britain's responsibilities in Hong Kong.



If we, the government, had wanted simply to be rid of Hong Kong, then nothing could have been easier. We had only to let the 19th-century treaties run their course. These required the return to China in 1997 of 92 er cent of the_territor-y-oLHong

-Kong_and the remaining...8 p,eL cenLwould, of_ course, _have been_l.111..viable on its_o_w_p.



Before the negotiations, the Foreign Secretary continued,



rthe Chinese had ma_de it cle_gr,_12ub!i_cJy_a!)d_p_.t_iv�Jely_ ,_ tha_r_tbey intended to recover

--SQ.V�gjgnty gver the wh_ole_ of Hong :K�They wanted _IlO��fg�ment about (t.�t an argument is just what they_gQ_t_._They gQL a_ very �r_c:Ln�gotiatiop..

Britain could md shQ_yld h_ave_ argued, writes Monckton, t_h�t the people_ _2f Hong Kong wisb�d to remaip _under the government of Britai!). If he had read the September 1984 White Paper he would know that that is precisely what we did.

But, to nobody's surprise, we could not persuade the Chinese to abandon their right - even as we see it - under the very same treaty that-cre�ted Brjtain'.§_9-9--yea.r lgse,-to-the retuq1 of Hong Kong in 1997� -

What we did achieve-by clogged insistence on the need to satisfy the wishes of the people of Hong Kong, was a detailed and legally binding international agreement providing for the continuation for 50 years beyond 1997 of Hong Kong's capitalist

economy, its common law system and the rights and freedoms of its people - all built up under British administration.J

The agreement contains explicit assurances from the Chinese about how Deng

Xiaoping's 'one country, two systems' formula will work, and how Hong Kong will enjoy a high degree of autonomy.

The Sino-British Joint Declaration, to give the Hong Kong agreement its proper name, was signed by the Prime Minister. It was recognized at the time as a great diplomatic achievement . . . It was acclaimed by both sides of Parliament. Most

Final Years 321

importantly, the agreement was well received by the people of Hong Kong and by investors there.



Sir Geoffrey went on to an eloquent defence of the agreement and of Britain's position on Hong Kong. Having sweated blood on achieving such a document 'in tough negotiating sessions in Beijing . . . why should we, of all people, now be trying to give it all away?'

In fact, for almost the whole of the first year of those negotiations Britain had tried to retain some element of British presence in Hong Kong after 1997. But in the end the Chinese would have none of it.

The question of Hong Kong began to agitate the government of the territory and that of the United Kingdom in the latter part of the 1970s. As the span of the lease entered its last 20 years it was forecast that its impending termination, come the early 1980s, would begin to deter investors. It would also inhibit the Hong Kong government from granting new leases on land beyond 1997. By this time the British government had made an examination of the question in consultation with the Governor. He then, in March 1979, paid a visit to Beijing at the invitation of the Chinese Minister of Foreign Trade, and an attempt was made, on British initiative, to solve the problem of land leases. These discussions came to nothing.

In the following two years anxiety on the subject grew in Hong Kong and was expressed in the Executive Council on 1 May 198 2. In the previous January the Lord Privy Seal, on a visit to China, was given some indications of the Beijing government's views on the future of Hong Kong. The British government inclined to the view that negotiations should be opened.

With this as background the Prime Minister, Mrs Margaret Thatcher, visited China in September of that year, and during the course of that visit substantive discussions took place. Chairman Deng Xiaoping and the Prime Minister followed their meetings with a statement:



Today the leaders of both countries held far-reaching talks in a friendly atmo­ sphere on the future of Hong Kong. Both leaders made clear their respective positions on this subject. They agreed to enter talks through diplomatic channels following the visit with the common aim of maintaining the stability and prosperity of Hong Kong.



The first round of talks took place between the British Ambassador to China, Sir Richard Evans, and the Chinese Foreign Ministry, during which the basis on which further talks should be conducted was agreed. On 1 July 1983 it was announced that the second phase of talks would begin on the twelfth of that month. This consisted of formal rounds of talks between the delegationi of both sides, led on the British side by the Ambassador, and for the Chinese by a Vice or Assistant Minister of the Chinese Foreign Ministry.

3 22 An Illustrated History of Hong Kong

The Governor of Hong Kong, Sir Edward Youde, took part in every one of the rounds of talks as a member of the British delegation.

During these sessions it soon became clear that the Chinese would tolerate no continuing British presence after 1997. The British then cast around to see what could be done in conjunction with the Chinese to maintain stability after 1997, other than by any form of British presence.

The Chinese proposal of creating a Special Administrative Region of the People's Republic in the form of Hong Kong appeared to provide a possible basis for further discussion. By April 1984 it was apparent that the initial discussions had formed an acceptable basis for negotiation, and at this point the Chinese invited the Secretary of State for Foreign Affairs, Sir Geoffrey Howe, to visit Beijing. This visit took place between 15 and 18 April. Further progress was then made, and on his return journey to London Sir Geoffrey made a statement on the talks in Hong Kong. After stating that it was not reasonable to consider a British presence in the territory after 1997, he announced that Her Majesty's Government was examining how to make arrangements for a high degree of autonomy for the territory under Chinese sovereignty, its way of life and present systems being preserved in essentials. In June a working group was set up to meet full-time in Beijing to consider documents tabled by both sides, and the Foreign Secretary again went to Beijing in July, devoting his time there almost exclusively to the Hong Kong negotiations. On 1 August in Hong Kong he announced that very substantial progress had been made. He also announced the establishment of a Sino­ British Joint Liaison Group to come into being when the agreement was signed and to continue until the year 2000, its functions to be liaison, consultation on the implementation of the agreement, and exchange of information. It would have no part to play in Hong Kong's administration which was to continue with the British government until 30 June 1997. After further negotiations both sides approved the English and Chinese versions of the agreement and associated Exchange of Memoranda, and these were submitted to British and Chinese ministers for approval, the texts being

initialled by the leaders of both delegations on 26 September 1984.

The negotiations - long as they were - had been conducted on an agreed basis of complete confidentiality. This, it was recognized, would possibly have alarming effects in Hong Kong, but was essential to their success. The members of the Executive Council - the Governor's 'Cabinet' - were kept informed throughout, and advice on the attitude of Hong Kong people was sought all along from the Unofficial Members of the Executive and Legislative Councils (UMELCO). The negotiations were not concluded in haste or without due consultation, and during them UMELCO members and the Governor several times visited London for talks with the Prime Minister and other ministers. Groups and individuals in Hong Kong, and also the Legislative Council, made suggestions for what might be included in the



The signing of the Sino-British Joint Declaration in Beijing in December 1984.



/

agreement. The government sought to be in close touch with Hong Kong as well as British opinion on the subject in so far as the confidential nature of the talks permitted debate.

The Joint Declaration was signed in Beijing in December 1984 and the instruments of ratification were exchanged in May 1985 (see Appendix 10). Sir Geoffrey, in his letter already quoted replying to Sir Walter Monckton, which appeared in London on 9 August 1988 and in Hong Kong the day after, continued in defence of the treaty and the British government's concern for the people of Hong Kong as an 'important British interest' which would continue as such 'after 1997'. He pointed to the 'unprecedented strength of investment in the colony since 1984' which, he thought, testified 'to the renewal of confidence there after the bleak years of 19 8 2 and 198 3. So too does the astonishing GDP growth of more than 30 per cent in the last three years'. The view, however, could plausibly be advanced and supported that these facts revealed not so much a long-term investor confidence but just the normal inclination for money to be deployed where, for the time being, it is most likely to reap the best profit - to make what killing may be made before

it is too late.

He was, moreover, writing before the effects of what was to become a daily topic in the Hong Kong media - the so-called 'brain drain' - became noticeable. The realities of the process whereby many thousands are seeking, and have squght already, refuge in another country from their homes in Hong Kong are hard to assess in the short term; and it is not the intention of this history to comment on events and conditions relating to Hong Kong in the

3 24 An Illustrated History of Hong Kong

time after the signing of the Joint Declaration. We are much too close to the substance of post-1984 history to have a balanced view. Opinions voiced by all and sundry in the years since the Declaration have varied widely on the probable result for Hong Kong of its implementation after 1997. Few people among the close to six million Hong Kong citizens have actually read the original documents despite the commendable attempts by the government and others to induce them to do so, or at least to take in a digest of their content. Most people have, however, formed some opinion - some notion about the Hong Kong of the future might be a better way of defining it - and most are willing to pronounce on the subject privately. Such opinions range all the way from the fatalistic 'what will be will be', through the doom­ laden which predicts Communist oppression accompanied by personal and corporate financial ruin, to various degrees of optimism.

On one aspect perhaps the majority of persons would be in some agreement - scepticism in regard to the continuing interest voiced by Sir Geoffrey and others in London of the home government in the future of Hong Kong people, most especially on the issue of nationality. The British National (Overseas) passport (carrying no right of residence in the United Kingdom) is almost universally derided as a sham. And if the British government is precariously balanced on the knife-edge of political expedience ( called realism) between the moral requirement to afford its Hong Kong nationals that right, and the hostility of the British public at large to its granting - that is its own problem (say Hong Kong people) and why should we suffer the consequences ? The right, were it granted, would be taken up by very few - for Britain is not viewed by the Chinese in Hong Kong with any marked favour as a place to live and work in. But it would in the last resort constitute an escape were conditions in Hong Kong found to be intolerable.

On that last day of June 1997 an event unique in British history will take place. Britain will hand over the sovereignty of a colony not to an indigenous government in that colony, but to the government of a foreign power. There is no important precedent for that action. 1 That the situation is the almost inevitable outcome of the original treaty, extracted under duress from the Chinese, and was arguably foreseeable (given the strength of Communist China) , makes the contemplation of the portentous coming event no less equivocal and disturbing for the six million people of Hong Kong.

The vexatious question that posed and still poses itself in the minds of thoughtful citizens, whether Chinese or others who have made a life in the colony, is the degree of autonomy that is likely to remain for even the first of those 50 years after 1997, during which China has promised not to change Hong Kong's systems and life-style. Like China, Hong Kong has not been under democratic rule; but it has been ruled under written laws. The response of the populace has generally been to consent to this. When offered the right to vote, as they were in the District Board elections of 198 2, the electorate

Final Years 32 5

turned out in very small numbers, demonstrating their reluctance to bother interfering in the slightest way with the due and accustomed state of affairs. Perhaps also the reluctance to vote, the majority of potential voters being Chinese, was also the result of the total absence of a democratic tradition in Chinese history. The concept was perhaps too foreign to be attractive.

Meanwhile changes in the composition of the Legislative Council were under discussion. Until 1964 official members always had a majority over unofficials, but in that year parity was achieved in numbers, with the Governor holding the casting vote. From 1976 it became the practice not to appoint the full complement of official members, allowing the unofficials at first two, later rising in 1983 to 10 votes more than the officials. In 1984, by amendments to the Royal Instructions, the permissible number of unofficials was raised to 32, with officials at 29, in theory ending the possibility that officials could outvote unofficials; the former possibility of appointing extra officials if needed to outvote unofficials also came to an end.

In 198 5 the composition of the Council was: officials (inclusive of the President, the Governor) 11; appointed unofficials 22; elected officials 24: total 57. At this point, for the first time in its history, the chamber held 24 out of 57 members who had won their seats in competitive elections, retaining them for three years. Those elections were the result of a Green Paper published by the government in 1984 during the final stages in negotiations with the Chinese on the future of Hong Kong. The publication of the Paper caused some surprise since there had been no special demand for an increase in this aspect of democracy. But, on the principle that a government ruling by consent is wiser to offer more that it is asked for, the move appeared to be a progressive one. Whatever future reforms of the Council or constitutional changes may be made are required to be compatible with the system that China will introduce in 1997. This in large part was spelled out in the finalization of the Basic Law, agreed in early 1990 and approved by China in the spring of that year.

I

I

Despite official and unofficial efforts via the media to encourage people to take a more active part in Hong Kong affairs, little general participation followed - until the brutal events of 4 June 1989 in Beijing unfolded on every television screen in Hong Kong and around the world. Only then, with all the affront of a deep sleeper aroused untimely, did the public awaken with cries of mingled bewilderment and horror. If late in registering their opposition to the bulldozing tactics of the Chinese over such matters as the composition of the legislature post- 1997, at last they took to the streets, to the air, to the press, and even to lobbying in the House of Commons and in Beijing itself - in loud protest. They saw in the suppression of fledgling attempts at democracy in China the grey shadow of Communist rule ap­ proaching �ith the inevitability of sunset.

The story of Hong Kong as a virtually independent city state thus ap-

326 An Illustrated History of Hong Kong

proaches its end in the form which has evolved over the past century and a half. The future is shrouded in enigma and viewed with enormous and very natural apprehension by the vast majority of its people. 2

Hong Kong whose achievement, the product of those people, has to be seen as something of peculiar grandeur in the summing up, must meet and accept in July 1997 the imposition of a different authority. City states, nations, empires, it is common knowledge, outlive their usefulness and wither. But it is widely believed, both in Hong Kong and elsewhere (outside China), that Hong Kong will not by then have outlived its usefulness. Will the substance of an agreement between Britain and China to establish in the territory the degree of autonomy envisaged under the 'one country, two systems' notion continue to nurture its evident health and validity ? Until the advent of the new administration in 1997 there can be no certainty.



NOTES



NOTES TO THE INTR ODUCTION



r. See Appendix r.



NOTES TO CHAPTER 1



r. An explanation of all unfamiliar terms can be found in the Glossary.

Waley, A., The Opium War Through Chinese Eyes, p. 29 .

Wood, H. J., 'Prologue to War: The Anglo-Chinese Conflict 1800-1834', pp . 173-4.

Quoted in Chang, H. P., Commissioner Lin and the Opium War, p. 49.



NOTES TO CHA PTER 2



r. Hunter, W. C., The 'Fan-kwae' at Canton Before Treaty Days, I825-I844.

2. Foreign Office, General Correspondence, China 17 /3 5.

3. For this and the following quotations I have relied on Waley, A., The Opium War Through Chinese Eyes, and Chang, H. P., Commissioner Lin and the Opium War.



NOTES TO CHAPTER 3



r. Eitel, E. J., Europe in China, p. 60.



NOTES TO CHA PTER 4