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HONG KONG: SPECIAL REPORT

One Country Two Systems But Will It Be Free?

June 15, 1997

As the world watches July 1, freewheeling, capitalist Hong Kong will sink back into the arms of its motherland--a changing, but still Communist, China. Never before, without revolution or war, have so many people and so much wealth been exchanged between two sovereign states--much less between two such alien systems.

Hong Kong's return is a historic inevitability, anticipated since China grudgingly leased the New Territories to Britain's Queen Victoria 99 years ago. But the hand-over still brings its own questions and surprises.

Will China try to change the territory's pragmatic blend of Eastern and Western cultures, an unfettered force of Chinese ingenuity, refugee ambition and the Victorian work ethic that has spawned an economic miracle?

Can Hong Kong remain a place where the wealthy and the workers alike know that getting ahead requires quick action and creativity--not merely connections?

Can China continue to resist Hong Kong's dynamic political culture, or will it insist on keeping order, mainland-style, with harsher laws or even military force?

Or does the biggest threat lie within: Could Hong Kong hand over its own liberties, unbidden, in exchange for personal favors?

Such uncertainties have caught the world's attention. But Hong Kong's return, many say, may signal a larger transition--not only the end of Empire but the emphatic affirmation of a new era in which communism dissolves into capitalism's whirlwind, and an ascendant Asia forges its own way forward.

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