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1The institutional context
The main principles of ‘One Country, Two Systems’ and the National People’s Congress Standing Committee decision1
Hong Kong officially became a British colony under the 1842 Nanking Treaty that ended the first Opium War. According to the Treaty, Hong Kong Island was ceded in perpetuity to the British. In 1860, the Kowloon Peninsula across Victoria Harbour was added (also ‘in perpetuity’) to the original possession by the first Convention of Peking and on 1 July 1898, the colony was greatly enlarged by the adjunction of the New Territories through the signing of the Second Convention of Peking. In contrast to the Hong Kong Island and Kowloon Peninsula, the New Territories (which covers an area 12 times larger than the first two territories combined) were not ceded in perpetuity, but leased for 99 years. By the end of the 1970s, as the expiry date of the lease (30 June 1997) drew closer, the British pondered the future of the colony and opened discussions with their Chinese counterparts on this issue. The result was the 1984 signing of the Sino-British Joint Declaration (formally known as the Joint Declaration of the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of the People’s Republic of China on the Question of Hong Kong), by which the two countries agreed that all the three parts of Hong Kong would return to Chinese sovereignty at the end of the lease.
The Joint Declaration framed the conditions by which Hong Kong would be administered after 30 June 1997. These conditions, which were later translated in legal terms into the Basic Law (Hong Kong’s ‘mini constitution’), promulgated in 1990, were supposed to follow the ‘One Country, Two Systems’ principle (to be discussed later in this chapter). Even though ‘One Country, Two Systems’ had been continuously discussed since 1984, a short recall may be useful because of its impact on Hong Kong’s governance – whether political or economic (Section titled ‘A short recall of the main principles of the Basic Law and their interpretation’). This would serve as an introductory framework to the section titled ‘The effective power of the Chief Executive between theory and practice: a literature review and interpretation of the crisis of legitimacy of the government’, in which the authors insist that a combination of the situation inherited from the colonial era and the design of the Basic Law did not allow the CE to gain sufficient legitimacy to exert all the powers he is granted by the Basic Law.
On the contrary, the authors will only show that the CE has, in fact, lost some of the legitimacy the governor had enjoyed in most of the colonial era. This will be done through the classic differentiation between the procedural legitimacy (based on democratic elections) and the legitimacy-by-performances. While the first type has remained basically unchanged from the last decade of British rule over Hong Kong (despite minor evolutions), on the contrary and for reasons that will be presented in the section titled ‘The effective power of the Chief Executive between theory and practice: a literature review and interpretation of the crisis of legitimacy of the government’, the two main elements of the procedural legitimacy (namely, economic performance and governance) since the handover have encountered drastic evolutions which further eroded the ability of the CE to fully utilize its constitutional powers. The design of the Basic Law has reinforced the traditional imbalance in favour of the economic élites – this very last point being the focus of ensuing chapters – while, at the same time, these élites are less supportive of the current government than of its predecessor. In such a situation, the constitutional package proposed by Beijing in August 2014, if effectively implemented, would be far from sufficient to provide the CE with the additional legitimacy he needs. In other words, the Hong Kong government has been unable (and unwilling) to implement substantial reforms due to the opposition of the business élites, its own ideological positions and pressure from China. This has led to a certain paralysis of the political system just as the demand for change has strengthened. As the next few chapters will show, the same phenomenon occurs in the economic sphere, which creates a contradiction between a system that does not evolve and the pressure from people who feel trapped and have become increasingly restless.
A short recall of the main principles of the Basic Law and their interpretation
The objectives of ‘One Country, Two Systems’ were to grant Hong Kong a ‘high degree of autonomy’ (except in foreign and defence matters),2 to respect its economic and social systems,3 to safeguard its legal system (including the independence of its judiciary),4 to assure the fundamental rights and freedoms of its residents,5 etc. It also stated that China’s socialist system would not be implemented in Hong Kong for 50 years starting from 1 July 1997, while the Hong Kong government could keep control of its economic (including its currency, the Hong Kong Dollar (HK$), and its own public accounting and tax systems) and immigration policies.6 Hong Kong would remain separated from China by a border and distinct customs. Finally, by virtue of the principle, ‘Hong Kong people govern Hong Kong’, it was also decided that the leader of the Territory, the CE, must be a Hong Kong permanent resident (s)elected locally (albeit through a complex and restrictive election system). These are, in fact, the main items regulating the ‘Two Systems’ component.
Other principles were captured in the ‘One Country’ element, such as a ‘high degree of autonomy’ not being equated to independence. This is clearly stated in the Basic Law’s very first article (Article 1): ‘The Hong Kong Special Administrative Region is an inalienable part of the People’s Republic of China.’ China, therefore, keeps a certain level of control over Hong Kong. For example, the final decision to appoint the CE belongs to the Chinese government.7 Equally important, in case of any ambiguity in the Basic Law, the NPCSC (the Standing Committee of the National People’s Congress – China’s Parliament) has the final say in its reinterpretation. The NPCSC can also propose modifications to the Law – but these modifications would have to be voted on by at least two-thirds of the members of Hong Kong’s legislature (the Legislative Council or LegCo) and then ratified by the NPC before being incorporated into the Basic Law.8 As one will see, all these conditions have played a fundamental role in the recent institutional crisis.
Thus, the ‘One Country, Two Systems’ principle has a unique institutional design that has never been tested elsewhere. Notwithstanding the risk of failure, it is patent that ‘One Country, Two Systems’ leaves room for interpretation and ambiguity, so controversies have occurred since the handover.9 The Basic Law cannot always answer all situations and, most notably, fails to fully clarify the intricate relationship between Hong Kong and the Central government: the former often enjoys a high degree of autonomy (in accordance with the Basic Law) and sometimes this causes tension between the two.10
The effective power of the Chief Executive between theory and practice: a literature review and interpretation of the crisis of legitimacy of the government
In this section, the authors will expose how the Hong Kong government’s crisis of legitimacy, which already existed during the colonial period, has deepened since the handover. It will be argued that while the crisis has been, and still is, a powerful engine for introducing some kind of democratic reforms for the (s)election of the CE, it is also a major cause of the current institutional stalemate. In fact, the failure to enact political reforms, due to resistance from local economic élites and China (such failure was epitomized by the results of Beijing’s 31 August 2014 decision), has exacerbated the existing political, economic and social crisis.
One major reason for this is that the CE is unable to fully exert the large powers that have been bestowed on him by the Basic Law. Three rationales can be put forward to support this statement (which will be fully presented in this section). First, the governing coalition has weakened since the handover, while the economic élites have become less supportive of the government. Second, Hong Kong’s political system is increasingly disarticulated – and this is well explained in a thesis introduced by Ian Scott (1989, 2000, 2007, 2010). Third, Hong Kong society has diversified. As a result, (conflicting) demands by Hong Kong’s political parties and social movements have proliferated in recent years and their demands have become more difficult to satisfy. While Beijing has constantly mentioned ‘restoring’ or ‘maintaining social harmony’ in Hong Kong (as well as in China), the increasingly polarized society and disarticulated political system in Hong Kong have left the CE more isolated than ever, with the Central government as his main backer. The government’s inability to engage in suitable reforms has led to some degree of paralysis in its governance system, which has combined with the recent paralysis of the economic system (which will be examined in the next chapters).
Making use of the concept of legitimacy, the same thesis can be presented from a different perspective. It can then be noted that the government has to face the quasi absence of two forms of legitimacy: procedural legitimacy and legitimacy-by-performances (see below for their respective definitions). A weak procedural legitimacy is hardly a new phenomenon in Hong Kong. It existed during the colonial era, but the colonial authorities were able to accommodate it with legitimacy-by-performance to a certain extent. What is interesting, however, is that the change of sovereignty did not bring about an added procedural legitimacy to the current government. In fact, the reverse has happened.
In addition, the Hong Kong government has had to face a shrinking legitimacy-by-performance. This phenomenon is not only linked to the economic crises that have appeared since 1997, but also to the government’s inability to address existing economic and social imbalances, which have led to declining opportunities for Hong Kong’s young people. As the authors will show in the next chapters, the government’s failure to implement necessary economic reforms has been one of the reasons why these young people have transferred their demands from the economic arena into the political arena, which further fuels the legitimacy crisis. Through a literature review, this section will concentrate on these different issues, particularly on the evolution of the political system and its crisis since the handover.
Procedural legitimacy and legitimacy-by-performance: an assessment
Once again, the starting point for analysis is the Basic Law. The fact that China and Hong Kong’s economic élites want to keep the political and economic systems as close as they were to their colonial predecessors is strongly encapsulated in the Basic Law. This may seem counterintuitive or even paradoxical, but the
belief enshrined in the Basic Law is that there is much value in the colonial legacy, which includes clinging the social goal or stability and prosperity, administrative efficiency, political neutrality of civil servants, the rule of law, and gradual political reforms.
(Lam 2012: 3)
Whether or not the drafters of the Basic Law truly aimed to promote ‘gradual political reforms’ is arguable, but it is true that the
general framework of governance [is] (…) highly similar to the colonial government’s: continuing elitist rule, executive-led government, laissez-faire economic policy, a capitalist way of life, the protection of individual freedoms, and limited democracy.
(Ibid.)
In policymaking, however, the same recipe does not necessarily create the same dish, as history matters, too. On the one hand, Hong Kong’s ‘laissez-faire economic policy’ has been more a motto (before and after the handover) than a reality – a topic that will be analysed at length in the next chapters. On the other hand, Hong Kong’s political and economic situation has progressively evolved and required some adaptations that never came. In order to understand the reasons behind these phenomena and their consequences, the authors will examine Hong Kong’s historical evolution from the colonial era to the present. Their emphasis will be on structural and systemic factors, even though they do not deny that successive (world) economic crises and some ill-fated decisions by the CE and the government have also influenced public opinion.11
In the meantime, it is worth starting with a definition of ‘legitimacy’ and linking it to the concept of governance. This has been done quite clearly by Ian Scott:
Legitimacy relates to the moral authority which a government possesses, the right to govern and that right, in turn, rests on consent of those affected by its decisions (…). When a government takes action by seeking to introduce new policies, it relies on the conviction of its citizens that it is entitled to take such action, that it has been given the authority to do so, either implicitly or explicitly. In the absence of such authority, government action can only be based on relationships of...
