20 years on, HK prospers under 'one country, two systems'

In a 1995 cover story, prior to Hong Kong's return to China in 1997, Fortune magazine, among a lot of similar hullabaloo, predicted that the handover would bring about the eventual demise of the city.

Defying the prophets of doom, Hong Kong, as a special administrative region of China, remains one of the most dynamic cities in the world 20 years after its return from the British rule.

Over the past two decades, the Hong Kong Special Administrative Region (HKSAR) has emerged stronger out of the challenges of the Asian and global financial crises and the SARS outbreak.

It has remained a center of international finance, shipping and trade, and has been widely recognized as one of the world's freest and most competitive economies.

The rule of law and freedom are still respected.

The city's success is down to much more than a little luck.

During the last 20 years, "one country, two systems" has proven not only to be the best solution to the Hong Kong question left over from history, but also the best institutional arrangement for Hong Kong's long-term prosperity and stability since its return, said Chinese President Xi Jinping.

The "one country, two systems" formula has charted Hong Kong's 1997 return to China and its ensuing prosperity for the past 20 years.

Under the formula, the HKSAR retains its previous capitalist system, is a separate customs territory, adopts its own economic and social policies, and is authorized to conduct relevant external affairs commensurate with its status.

"The unique form of governance in the HKSAR has been largely successful," said Kurt Tong, U.S. consul general to the Hong Kong and Macao SARs.

The "one country, two systems" framework "allows Hong Kong to be special and different while still being part of China," Tong said, adding that the people of Hong Kong are "prosperous" due to Hong Kong's "specialness."

A concept made concrete

Sze Chi Ching and his four sons have never regretted staying in Hong Kong around 1997 when many people left.

Sze was already a successful entrepreneur when the governments of China and Britain signed the Joint Declaration in 1984, confirming that the government of the People's Republic of China would resume its exercise of sovereignty over Hong Kong with effect from July 1, 1997.

"Is there any place in the world freer than Hong Kong? No. Hong Kong is a very lovely place in terms of political, economic and living environment," Sze said.

In the early 1980s, late Chinese leader Deng Xiaoping put forward the concept of "one country, two systems" in an effort to realize the peaceful reunification of China. This design, described by former British Prime Minister Margaret Thatcher as "an ingenious idea," was first used to solve the question of Hong Kong.

According to Deng Xiaoping, "one country, two systems" means there is only one China and under this premise the mainland adheres to the socialist system while Hong Kong, Macao and Taiwan may retain their capitalist systems over a long time to come.

"People were not optimistic about the concept when it was first proposed," said Cheung Chi-kong, executive director of the Hong Kong-based One Country Two Systems Research Institute. "Such a pioneering initiative of the coexistence of socialism and capitalism in one country has no precedent in any country."

In the past 20 years, Hong Kong has turned "one country, two systems" from a concept into a reality.

The city's previous capitalist system, economy and way of life have remained as unchanged as possible, and the laws remain basically the same.

Horse racing, ballroom dancing and stock exchanges, the three "remarkable capitalist characteristics" pledged to be retained for at least 50 years, all do brisk business as ever in Hong Kong.

Hong Kong people flock to race courses in Happy Valley or Sha Tin on Wednesday nights and at weekends as they did before the handover, or hang out in Lan Kwai Fong, a hot spot of Hong Kong's nightlife.

The capitalization of the Hong Kong securities market had reached about 3 trillion U.S. dollars by the end of 2016, ranking the fourth in Asia and the seventh globally, with the fund raised through IPOs in 2016 topping the world again, surpassing that in New York and London.

As provided for in the Basic Law, HKSAR has a high degree of autonomy and enjoys executive, legislative and independent judicial power, including that of final adjudication.

Figures released by the World Bank show political stability, government effectiveness, regulatory quality, rule of law, control of corruption, and accountability in Hong Kong are far higher than those before 1997.

In particular, Hong Kong's indicator of the rule of law, a core value of Hong Kong society, has jumped from behind 60th in the world in 1996 to the 11th place in 2015, ahead of some major Western countries.

It was rated the most competitive among 63 economies, followed by Switzerland, Singapore and the United States, the second year in a row to occupy the top spot, according to the International Institute for Management Development (IMD) World Competitiveness Yearbook 2017.

For Hong Kong tycoon Li Ka-shing, who came to Hong Kong at the age of 11 and started doing business in 1950, "one country, two systems" not only ensured the stability of Hong Kong, but created time and space for its people and businesses to evolve with a stable social foundation and structure.

The 88-year-old billionaire, in the capacity of Chairman of CK Hutchison Holdings and CK Property Holdings, witnessed first-hand Hong Kong's journey into a new era.

"One country, two systems" gives Hong Kong "front row seats" in development, helping it participate in national development plans, Li said.