Seizure

Hong Kong was seized from China by the British in three stages during the 1800's. Today it continues to serve the motherland well taxes are extremely low and become regressive for higher incomes, exchange restrictions are non-existent, and rock-bottom wages reflect the abundance of labour. Consequently, opportunities for profitable investment and industrial development are tremendous, and decolonisation has been steadily resisted.

China however has never rescinded her claim to Hong Kong as part of her territory In 1972, for example, she told the United Nations that:

"resolution of the problem is entirely within China's sovereign right . . . and should be settled in an appropriate way when conditions are ripe."

There are already close links between China and Hong Kong. China supplies Hong Kong with most of its food and water so that her support is essential for its continued existence. Indeed, the colony is her largest single export market and a valuable point of contact for the development of trade with the outside world. But though economically useful to China at the moment Hong Kong would also be an asset if included within her boundaries.

Besides foreign trade only accounts for 7% of China's total G.N.P., and her exports of rice and oil are in worldwide demand. Most important of all, China's actions are ultimately based on political considerations, not economic advantage. On these grounds, and keeping in mind that Britain's lease on the New Territories of Hong Kong expires in 1997, it seems unlikely that Britain's last industrial colony has more than a limited future in its present form.