Key moments since Hong Kong returned to Chinese rule

By Hazel Parry Jul 1, 2007, 12:36 GMT

Hong Kong - Hong Kong has, in the words of Chinese Prime Minister Wen Jiabao, taken a 'truly extraordinary path' since the day 10 years ago when the British flag was lowered and the city reverted to Chinese rule after 156 years as a British colony.

For all the sometimes doom-laden predictions that were made about what would happen to the wealthy, buzzing city after the People's Liberation Army marched in, no one could have predicted the roller-coaster decade that lay ahead.

Hong Kong was to be buffeted by the Asian economic crisis, put through a series of political upheavals and would become the epicentre of arguably the most frightening new disease of recent years.

Here, we pick out six key moments in 10 turbulent years for a vibrant city that, whatever happens politically or economically, is too provokingly individual to ever become just another part of China:

1. The stock market intervention, 1998: Within a year of its return to Chinese sovereignty, Hong Kong was in serious trouble. With the onset of the Asian economic crisis, unemployment rocketed to a 15-year high, property prices slumped and the Hang Seng Index fell to 6,600 points, recording a 44-per-cent drop in five months. Worse was to come, however, as speculators mounted an attack on Hong Kong's currency and its peg to the US dollar.

In a bold move led by then-financial secretary Donald Tsang, the Hong Kong government reacted by abandoning its celebrated free market principles and intervening in the market, spending billions of US dollars to prop up stock prices and drive off speculators.

The controversial and hair-raising tactic - which Tsang admitted gave him sleepless nights - worked. The peg was saved and the stocks bought by the government turned out to be hugely profitable for Hong Kong's reserves. All of which did no harm at all to Tsang's chances of one day rising to the position of chief executive.

2. The SARS crisis, 2003: For a few panicked weeks in the spring of 2003, planes coming into Hong Kong were virtually empty while planes going out were full of the wives and families of expatriate executives. Hong Kong was the epicentre of the global epidemic of SARS, or severe acute respiratory syndrome.

A total of 299 Hong Kong people died and 1,800 others were infected with the pneumonia-like virus, which originated in southern China. The outbreak cost Hong Kong billions of dollars and plunged it into its worst economic crisis since the 1997 handover but also spurred the city into a remarkable recovery when SARS disappeared almost as mysteriously as it surfaced.

3. Anti-government march, July 1, 2003: 'Hong Kong people don't care about politics. They only care about making money.' That was the myth exploded in spectacular fashion when more than 500,000 people took to the streets to protest against the government and demand democracy in the biggest single demonstration seen in Hong Kong since the aftermath of the 1989 Tiananmen Square massacre.

The march didn't make an immediate difference politically, but it did surprise and alarm both Beijing's leaders and the Hong Kong chief executive put in place by China, Tung Chee-hwa, whose authority was fatally undermined by this outpouring of popular discontent. Tung was eventually forced out of office in 2005.

4. The resignation of Tung, 2005: As far as the people of Hong Kong were concerned, there was nothing particularly disagreeable about Tung, the bumbling, grandfather-like figure appointed by Beijing to run Hong Kong after the 1997 handover. The former shipping magnate was ridiculed rather than disliked, portrayed in one popular comic book series as 'Silly Old Tung.' The problem was that he was seen as a Beijing stooge who would not listen to the demands of Hong Kong's people.

His overthrow, which began with the mass anti-government rally of 2003, was initially seen as a victory for 'people power,' but since it happened, Beijing has, if anything, tightened its political grip on Hong Kong. Tung has been replaced by the sharper and more popular Tsang, and some pro-democracy campaigners might wryly observe that their popularity peaked when 'Silly Old Tung' was in charge.

5. The chief executive election, 2007: Like the no-hope prize fighter stepping into the ring in a Rocky film, pro-democracy legislator Alan Leong went into the chief executive election acting as if he had a real chance of winning. He didn't, of course.

The 800-member, pro-Beijing election committee was only going to choose one winner, and that was the incumbent, the China-friendly Tsang. But Leong wrong-footed his opponent by gaining enough nominations to force a contest and even left Tsang sweating uncomfortably, Nixon-style, on the podium in a televised debate.

Tsang won the election itself comprehensively but found himself in a real fight and, perhaps when backed into a corner, promised to resolve the universal suffrage issue if re-elected. That promise might return to haunt him.

6. The hunt for the Yuen Long crocodile, 2004: For eight months, it grabbed headlines by the throat and won the hearts of Hong Kongers as it evaded capture again and again. The 1.5-metre Yuen Long crocodile, named for its neighbourhood haunt, first surfaced to cries of panic in November 2003, wading nonchalantly through river waters near the Chinese border.

Some said it was an escaped pet. Others speculated that it had escaped from a crocodile farm in southern China. One thing was for certain - it was one slippery customer. Under the glare of scores of flashbulbs, government workers and even celebrated Australian croc hunter John Lever made monkeys of themselves trying to catch it. The reptile eventually succumbed when it got caught up in fishing nets in June 2004.

Named person of the year in a radio poll, the crocodile, according to one imaginative analyst, became a metaphor for Hong Kong's desire to control its own destiny and free itself from the control of mainland China. It now lives quietly in an animal park, no doubt plotting its next great escape.