Hawaii’s World

By A.A. Smyser

Tuesday, November 26, 1996

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Mainland Chinese
are coming to Hawaii

FROM two recent meetings on the futures of China, Hong Kong and Taiwan I bring you some highlights:

Brush up on Mandarin, Hawaii! The mainland Chinese are coming and Hawaii is unprepared. People's Republic tour groups already are visiting. Many more will follow. Investment will follow that. The World Bank sees the PRC becoming the world's No. 1 economy by 2010. Already China has millionaires by the hundreds. Former President George Bush said China is changing so fast we no longer have time to be amazed. Hawaii will feel the impact.

Hawaii already is getting substantial discreet investment from Taiwan, which has the world's largest foreign exchange reserves even though its population is only a tiny fraction of that of the PRC. Much of the investment is under names that don't identify Taiwan as the source. A lot is "bottom fishing" looking for bargain prices in our depressed economy.

The future of Hong Kong is glum if you look to political freedom and the rule of law after July 1. Hong Kong's economic future is far brighter. Optimistic investors have pushed Hong Kong's real estate prices and stock market to new highs. A second tunnel is being built under Hong Kong harbor. A giant new airport will open soon. You can't get a hotel room in Hong Kong for the night of the transfer of government to China next June 30.

Queen Elizabeth already is disappearing from coins, bills and stamps. There will be an interregnum, however, where British laws no longer will apply and China may have no laws to replace them in kind.

China vetoed a "through train" in which Hong Kong legislators and judges could continue in office through the changeover. Though an elected legislature is promised, an interim appointed one will take over after July 1. The People's Republic already has shown a tendency to "legislate" for Hong Kong via press conferences by top officials.

There could be a shadow government in which the People's Liberation Army will play a significant role. Some people and businesses will get trampled in the changeover. A few of the most outspoken freedom, law and democracy advocates remember what happened at Tiananmen Square on June 4, 1989, and are contemplating possible martyrdom.

Self-censorship is apt to affect far more people and cool political discussion. Whether freedom and rule of law restrictions will chill external investment is a matter of debate. The PRC seems not to worry.

After Macau reverts to China in 1999 many residents will still hold Portuguese passports enabling them to live in Portugal and travel anywhere. Hong Kong residents will enjoy no comparable status with Great Britain. China may require people to choose between Chinese and foreign citizenry.

TWO Hawaii-based lawyers who deal with China, Taiwan and Hong Kong spoke recently to a Pacific and Asian Affairs Council breakfast about the rosy economic outlook for those areas. They reiterated that Hawaii seems unprepared to take advantage of it.

David Day and Frank Gniffke said it could mean turning to Hawaii for services ranging from the international know-how focused in our educational and conferencing establishments to using our 365-day growing season for raising lumber, aquacultural and agricultural crops for export to China. Gniffke is a University of Hawaii and East-West Center alumnus.

Views on Hong Kong's political future came from Alison W. Conner, a law professor at the University of Hawaii who previously taught law at the University of Hong Kong. She spoke at a monthly China Seminar lunch, blending pessimism with guarded optimism.