Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

10 Years Under Chinese Rule

HONG KONG -- Many were gloomy about Hong Kong's future 10 years ago when the British colony of dazzling skyscrapers and gung-ho capitalists returned to the communist Chinese motherland.

There were fears Chinese troops would be goose-stepping down the streets, muzzling any whisper of political dissent. Masses of peasants would stampede across the border, filling the city with beggars and thieves. And the most talented Hong Kongers would flee to other places welcoming their business savvy, workaholic ways.

Fortune magazine's headline, two years before the British flag came down, proclaimed "The Death of Hong Kong."

Ten years later, the soldiers are here, but are rarely seen in uniform on the streets. Mainland Chinese are pouring in, but as big-spending tourists buying Rolex watches and shark-fin soup. Many rich Hong Kongers are resettled in a booming city, happy that their fears have proved groundless.

But even as memories of Tiananmen fade, not all is well in Hong Kong. Media critics say some formerly outspoken newspapers now pull their punches to avoid angering China. Hong Kong is far from fully democratic. Its laws guarantee Beijing's candidates a majority in its partially elected legislature, leaving the popular pro-democracy parties permanently in the minority. The political and legal system is highly vulnerable to meddling by the overlords in Beijing.

"I don't think Beijing is seriously ready for democracy in Hong Kong," said Steve Tsang, an expert on Chinese politics at Oxford University in Britain.

When Britain's 156-year rule ended, in a lavish ceremony on the rainy midnight of June 30 to July 1, 1997, the deal was that the city could keep its capitalist ways and civil liberties for 50 years.

The formula called "one country, two systems" promised a wide degree of autonomy, and in many ways, Hong Kong still acts and feels like a country separate from China. It has its own currency and telephone country code. Its legal system remains British and its judges wear wigs.

The election system, however limited, is far freer than anything in China. Hong Kong's leader is the highly popular Donald Tsang, a policeman's son steeped in the British civil service tradition and knighted in the final days of British rule.

So far, the former colonial masters say things are going jolly well.

Former British Prime Minister Margaret Thatcher, whose government negotiated the handover agreement 13 years, recently told the BBC that worries about Hong Kong's future "have largely proved groundless."

Last year, Hong Kong's stock market surpassed New York as the second most popular place -- after London -- to float new stock listings.

But predicting Hong Kong's political future is difficult because Beijing has yet to thoroughly explain when it thinks the city will be ready for full democracy.

As a so-called Special Administrative Region of China Hong Kong has to walk a fine line between "one country" and "two systems," and Tsang thinks the Chinese leadership is worried that a free election may give Hong Kong a leader who would put it on a collision course with China.